Finance and family assistance can be an awkward combination. Paying down debt, medical bills, and tuition costs can all take their toll on personal relationships. SO what are the top 5 questions you need to ask yourself before helping out a loved one?
- Can I afford it? You want to make sure you can afford to pay for yourself before you start to bail out another family member.
- If your giving a gift, does it have strings attached? If you’re feeling hesitant about it then it may not be the best move for you.
- If the gift is a loan, what are the repayment terms? Keep in mind if the money doesn’t get paid back then it can destroy a relationship therefore your repayment terms shouldn’t be based on trial and error.
- Should I get things in writing or see an attorney? This should be your judgment call. Sometimes an IOU is enough but a personal judgment call can help add a sense of accountability.
- Does this money come with a life lesson? Make sure you know how to handle the situation you are getting into and keep an eye out for ugly situations as you don’t want to make the experience negative.
So, before you start mixing personal finances with personal relationships be sure you know what you are getting yourself into. Be aware that things could get messy so you want to follow all of these steps to avoid those sticky situations.