Q:

How do you help a family member in financial need?

A:

Ways to help family members in financial need include giving them money, making them loans, co-signing on loans and paying some of their bills. Although bringing money into a family relationship can be awkward, sometimes helping a family member financially is the right thing to do. However, as Investopedia warns, it is important to think through what help is feasible before making any offers.

Anyone giving money to a financially strapped family member should make it clear that the money is a gift so as to preserve the relationship. If gifts are large enough, they may qualify for the Internal Revenue Service's annual gift exclusion.

If a family member asks for a loan, the transaction should be handled in a businesslike manner. Loan terms should be written down and should include the amount of the loan, the interest rate, how and when repayment will be made, and what happens if the family member fails to make payments.

A family member who has a weak credit score may ask for help co-signing a loan. Anyone who agrees to this must realize he is personally responsible for the loan, should the family member fail to pay. The co-signer could find the loan has a negative effect on his own credit score.

Prepaying a family member's bills during a cash crunch can be a very effective way to help him out. The relief of knowing that a car payment or utility payment is taken care of can give that family member just enough time to work out his own situation.

Sources:

  1. investopedia.com

Is this answer helpful?

Similar Questions

  • Q:

    What do you do when a family needs financial help?

    A:

    When a family needs financial help, options to provide assistance include giving a gift of cash, making a personal loan or co-signing on a bank loan, hiring a member of the family, or prepaying some of the family's bills. Non-monetary help one can provide to a family in need of financial assistance includes helping to develop a feasible budget and connecting the family to others who can provide help.

    Full Answer >
    Filed Under:
  • Q:

    What are ideas for family and friends day at church?

    A:

    Ask each member to invite personal friends and family members to church. Set up special sections or booths honoring the guests. Make a bulletin board or a large welcoming sign, and hang it over the doorway or outside the church. Indoor and outdoor seating should be sufficient to accommodate large crowds.

    Full Answer >
  • Q:

    How can I get $8,000 dollars in two days without a job?

    A:

    Personal loans, lines of credit, payday financing, and borrowing from friends or family members are the best ways to accrue $8,000 in two days without a job. Although procuring $8,000 in two days without a job is possible, it requires a strong credit score, available credit and/or a network of willing family and friends with substantial liquidity.

    Full Answer >
    Filed Under:
  • Q:

    What are some differences between business and financial risks?

    A:

    The major difference between business and financial risks lies in where there is a shortfall. Business risk exists when there is not enough cash to meet the day-to-day operating expenses of the business, but financial risk involves the lack of cash necessary to pay creditors. One type of risk sometimes occurs in the absence of the other, or they may both happen simultaneously but independent of each other.

    Full Answer >
    Filed Under:

Explore