Two of the most common topics we discuss are finances and family. It's only natural to feel stressed out when a loved one comes to you for financial assistance on top of your already heavy workload.

It's only human to want to pitch in and help when those closest to you are in need. However, there are some safety measures you should follow before diving headfirst into financial matters. Do you realize, for instance, that lending money isn't necessarily the most helpful choice?

If you want to aid a loved one with financial issues, consider the following advice as you weigh your options.

Determine if Assisting is Right:

Helping loved ones through tough financial times is not obligatory. It may even be detrimental in some situations. To solve financial problems, one must first determine the root cause. Has your kid racked up a large credit card bill while shopping, or has an unforeseen injury resulted in expensive medical bills?

See if there's a major takeaway that should be absorbed. If the person's financial woes are the product of their carelessness, they may need to make an effort to settle the debt on their own. It may be helpful to receive financial assistance if one's financial issues result from unforeseeable circumstances, such as a loss of employment.

Make your Budget:

You should make a monthly spending plan to figure out how much, if any, of your income you can afford to give to your suffering parents while still saving for your future and other long-term goals, such as your child's college education.

Several Ways You Can Assist

You can do these when money is tight:

• Look at your spending habits and determine which ones you can cut back on, such as entertainment, publications, music, gas, and soda.
• Don't forget the obvious: mowing lawns, babysitting, shoveling snow, and delivering newspapers are all great methods to get some extra cash.
• Think of ways to make ends meet with your family's resources, such as learning to sew or mend clothes, growing your food, babysitting younger siblings, and cooking for the family.

Consider providing non-cash financial assistance:

If a member of your family is chronically broke and you're afraid to give them money for fear they'll waste it, there are other methods to help them out financially. You may volunteer to make a credit card payment on their behalf or purchase gas and grocery store gift cards to help them with some of these necessary outlays.

By providing non-cash financial assistance, you avoid the awkward situation of telling a loved one how to spend the money you give them. The cash will certainly be put to good use, either by speeding up the repayment of debt or covering essential living costs without borrowing.

Help them create a budget:

Budgeting is an essential part of fixing your financial situation. If your loved one is willing to trust you with financial details, you may be able to assist them in creating a budget. It can be tough to do it alone to create a sustainable budget that includes spending cuts. They can benefit from having someone else look at their budget and offer suggestions to make it more efficient.

Give a Monetary Gift:

Providing financial assistance to a family member or close friend who is having trouble, a monetary gift is a terrific option if you are in a position to do so. Please make sure the money is used as intended by discussing their plans.

Giving someone money is not the same as loaning them money. Therefore you can't expect to pay it back at a later date. Only give what you can comfortably afford in that amount.

Offer a Temporary Job:

However, not everyone is willing to part with cash in the form of gifts or loans. A better alternative could be to provide a job. It's possible to help a loved one by doing a second gig or a close friend in need of financial assistance to make ends meet until they can get back on their feet. All the specifics, the task specifications, and the agreed-upon prices must be discussed and clarified.

Help Them Solve Debt:

You might assume people only borrow money when they have no other options. They may not know about those other debt solutions. Trustworthy sources may help them.

Lines of credit and home equity loans might help people get through a tough time with cheaper interest rates than credit cards. Like every loan, these loans have risks. Before borrowing more money, a debt-repayment strategy should be developed. Otherwise, individuals may get caught in a cycle of borrowing that becomes difficult to break.

Debt relief is not limited to borrowing or getting additional money. Your friend or family can also arrange a debt settlement with creditors to lessen their unsecured debt payments.

Conclusion:

When a close friend or family comes to you for assistance, the emotional chords are pulled. As a general rule, your initial reaction is to agree.

Unfortunately, giving or loaning someone money for the umpteenth time is rarely the best way to ensure their well-being.

If you want to help them in the long run, you may have to play the bad guy in the short term. That may involve facilitating their enrollment in a treatment program, assisting them in securing gainful employment, or teaching them basic money management skills. Co-signing a loan or lease for them is an option as your trust in their abilities grows, but you want to assist them in becoming self-sufficient.