4 Ways To Help Loved Ones Dealing With Financial Hardships

4 Ways To Help Loved Ones Dealing With Financial Hardships

When a family member is in financial need there are more ways to help than just monetarily.

Originally Published Feb. 1, 2019

Approximately 1 in 5 Americans do not have emergency savings to cover a $500 emergency, according to personal finance website Bankrate. This statistic became a heartbreaking reality when real-life financial hardship stories recently surfaced due to the federal furlough.

Unexpected emergencies like medical bills, the death of a family member, job termination, or an unwarranted furlough are common causes of most financial traumas. The reasons people do not set aside money for these unexpected emergencies range from unlivable wages; sluggish salary raises with rapid inflation, unfair wage gaps, or even poor financial habits.

When a loved one is dealing with a temporary financial hardship, there are ways to provide assistance or relief.

4 Ways to Help Loved Ones Dealing with Financial Hardships

Lend money

If you can lend money to a loved one and are confident you will be repaid, offer a short-term loan. Treat the loved one with compassion, but explain that the offer is a loan expected to be paid back.

Write up and sign an agreement between you (lender) and the loved one (borrower) to clarify the financial transaction as a loan.

Debt.org shares that a loan agreement between loved ones should include:

  • The date of the loan agreement
  • The amount borrowed (principal)
  • Interest rate (if applicable)
  • Repayment terms (monthly payments over a specific period or a lump sum on a certain date)

In the event of nonpayment, the loan agreement should also include:

  • Modification of loan terms
  • Taking ownership of collateral
  • Possible legal action

Hard feelings and arguments between relatives and friends occur when money is lent in good faith but not repaid. So, take the advice I give to my clients who consider lending a loved one cash …

“If you can’t afford to give the money, don’t lend it.”

Give money

Instead of lending the money, give the loved one the amount of cash you can afford as a gift. Giving money as a gift releases the possible future tension if the loved one does not pay you back. Consider it as a few early birthday or Christmas gifts.

When giving money, do it privately, discreetly, and without pity. Many loved ones suffer in silence financially because they do not want their business to be shared.

Assure the loved one that you will not share the monetary gift with anyone. Respecting the loved one’s need for privacy is important, especially if they are a very private or prideful person.

Pay a bill directly

Consider paying a specific bill or expense directly if you prefer not to give a loved one cash or if they do not want to accept your loan or a monetary gift.

Paying utility, car, insurance, or even a rent or mortgage payment will release a significant financial burden.

Some companies, like PECO, formally Philadelphia Electric Company, allow people to help out and pay a bill on behalf of their customers.

Provide a service

Perhaps you may be unable to give a loved one money.

An act of service will go a long way when it comes to helping a loved one experiencing financial hardship. Sometimes, taking time to do something for someone is more helpful than giving money.

Some amazing acts of service can include:

Care for the kids

Offer to babysit or care for their elderly family member who requires special attention. This will free up time for the loved one to work another job or get some much-needed rest.

Cook a few meals

You may be aware of a loved one struggling to feed their family. Cook and deliver meals for a few days to offset their grocery bill and relieve the burden of cooking.


If a loved one does not have transportation, be their chauffeur for one or a few days. Driving them to appointments, running errands, or taking them to their job will be much appreciated.

Clean up the house

Clutter can sometimes cause just as much stress as financial trauma. To eliminate that responsibility from their list, offer to clean a loved one’s kitchen, bathroom, bedrooms, or the entire home. Often, a clean environment can calm our consciousness to better deal with difficult situations.

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