“Helping hands are better than Praying Lips” – Mother Teresa
Yes we should always help our friend and relatives financially if there is actually a need. It should not be the case that with borrowed money from you, your friend/relative is fulfilling their wants. Consider below points before lending money to your friend and relative:
1. Try to find out why he/she needs the money:
Ask all the related questions and find out the actual reason why he/she needs the money. Validate the reason with someone else and repayment capability. Otherwise the repayment issue might lead to a relationship breakup.
2. Do not hamper your own finance:
While trying to help your friend/relative, you should not compromise on your own goals. You are responsible for your personal finance; hence do not take any risk. In case you are willing to lend, then make sure you have enough cash/investments which will save you if borrower fails to repay.
3. Help them to get loan from financial institutes:
Help him/her to identify the financial institutes from whom he/she can take a loan. He/she can take a personal loan or loan against FD or Gold loan etc.
4. Do not lend if you are not comfortable:
It’s ok; if you are not comfortable of lending then you can convey this message to the borrower, such that he/she should understand.
5. Lastly Follow Up:
If you finally lend money to your friend or relative, then make sure that you follow up for the repayment. Because most of the borrowers do not show any urgency for the repay. Since it is your money, you have to do the follow up.
As this is your money and you know better about your financial goals, take your own call whether to lend money or not. Above points will help you while taking this decision.Follow Us In Social Media: