Helping a friend in financial need requires care and judgment, no matter your good intentions. Whether a friend asks for financial help or you offer it, the topic can complicate your friendship. Your friend might feel guilt, resentment or anger when in a position of financial need. When you offer financial help, it puts you in a position of having the upper hand.
This can change your relationship, creating perceptions of weakness on the part of the borrower. Make sure you are prepared financially and emotionally before making a commitment.
If you have a friend in financial need, there are many ways you can help. You can give a monetary gift, lend a listening ear or offer to help with family dinners.
Approaching Your Friend
Many people who fall on hard times withdraw from social contact because of the crisis they are in, even if their financial woes are no fault of their own. Although economic downturns increase hardship cases at all income levels, financially strapped people might still feel they are judged negatively due to mismanagement of their money.
Call or stop by to chat with your friend whenever possible. Listen when your friend expresses concerns about financial stress since this provides emotional support. However, don’t offer advice or money unless your friend asks for it.
It's Your Money
If you are thinking about offering financial help to your friend, ask yourself if you can afford it as a gift rather than a loan. Whenever you loan money, there's always the possibility that you'll never see it again. Even if your friend wants to pay you back in the future, her financial circumstances might not allow it.
Other obligations often take priority as your friend rebounds from challenging situations. Offer financial assistance only if you can afford it. Also, talk to your financial adviser about tax regulations regarding financial gifts. If it is an especially large amount of money, there may be tax consequences.
Helping Out with Expenses
Other ways of making it easier for your friend to accept money include offering to pay for services the family needs. For example, your friend or someone in her family might need help with medical or dental expenses that you can cover. This way, you will at least know the money is going to something specific.
If you own a business and are hiring, you could offer employment on a full- or part-time basis to help your friend, though you want to make sure she's qualified and that she understands she will be treated like any other employee. If you have space in your home, you could offer a room rent-free or for a small amount.
Financial aid also consists of helping in a way that doesn’t include money. For example, you could assist the friend at home with needed repairs or yard and housework. This will save her from having to pay someone else to do the work. Offer to pick her children up from school or handle other errands so your friend can focus more of her attention on getting her finances in order. These efforts save time and money for a friend in need.
If your friend needs someone to watch her children while she goes on job interviews or fills out financial assistance paperwork, offer to baby-sit them. Have your friend’s family over for dinner more often than usual, or bring over gifts of leftover food and snacks. Every bit of help can provide cost-saving measures and emotional support for your friend. Finally, keep your friend connected to the community. Financial difficulties can cause isolation and embarrassment. Encourage your friend to come along with you to social events.