Non-Cash Financial Help Options – Helping your Family without Giving them Cash

If you have family members in trouble financially, you may want to help them, but giving them cash may not feel right. If you’re worried your family members will just squander away the money you give them, here are 5 non-cash ways to help family members with financial troubles.

1.    Pay their Bills Directly

If you’re uncomfortable handing over cash, consider paying your loved one’s bills directly. This way you aren’t giving them cash, but you’re making sure their most important things are paid for such as electricity, gas, water, or their mortgage.

2.    Give Gift Cards

Gift cards to a specific store or for a specific purpose ensure your family members use the money as intended. They can’t get cash for the gift cards, so they’ll use them how you wanted, such as buying groceries or necessary clothing for the family.

3.    Hire your Family Members

Even if you don’t own a business, there are ways you can hire your family members so you’re paying them for work rather than just giving a handout.

Think about things you need done around the house, such as mowing the lawn, painting, or handy work. If your family member is good with his/her hands or has a special skill, make them feel useful by hiring them.

4.    Make a Loan

You can be a lender rather than just handing money over to your loved ones. This can be a little risky, so make sure they can afford it before doing this. If they default, you could end up losing money and/or ruining your relationship.

If you decide to loan money, put the terms in writing, be clear about the payments, the interest you’ll charge, and any action you’ll take if they don’t keep up with the payments.

5.    Consider Cosigning

If you don’t have the money (or don’t want to lend the money), consider being a cosigner for a personal loan or another type of loan that might help your family member.

Before you cosign, though, make sure it’s a loan they can afford. When you cosign, you become legally responsible for the payments if the primary borrower doesn’t make them.

If you decide to do it, ask the lender yourself how you’ll be notified of the loan’s status and make sure you have a plan to deal with it, so it doesn’t ruin your credit. If no one makes the payments, it will hurt your credit as much as it hurts the borrower’s credit.

Final Thoughts

Helping your family when they’re in a financial bind can feel right, but make sure you weigh all your options. Just handing over cash might not feel great because you don’t know what they’ll do with it, but other options can have consequences too.

Before helping, think about how it might affect your financial status, credit, or even your relationship with your loved ones. Finding non-cash ways to help can be the balance you need to help your loved ones and protect yourself financially.