5 Things to Remember Before Lending Money to the Family
In almost all the families, it is a common thing to ask money or seek help from one another to lead a decent life. The most important thing you have to keep in mind is that money spoils relationship. These people, perhaps, think that you earn a lot or you own a bungalow or an expensive car.
They don't see the increasing number of credit cards that you own and the bills which come along with them. People may have different needs and to tend to each and everybody's needs is very difficult. Moreover, money and friendship rarely go hand in hand.
There may be occasions when we can't avoid lending money to our relatives. Before lending, we have to keep in mind certain things. They are:
1. Explore Different Ways to Help
Just ask yourself as to whether there are other ways to help your relative. If possible, let that be your first option. Monetary help is not always the final solution. Sometimes, he may be benefited more from a different kind of help.
2. Lend Money Thinking That You will Never Get It in Return
If you don't want to be sad, lend money to your relative keeping in mind that there are huge chances that you won't get the money back. Even if you lose, don't be resentful.
3. Discuss With Your Cousin by When You Want the Money Back
When you make up your mind to lend money to your cousin, explain your expectations clearly. Work out a clear loan plan along with interest (if you expect) and talk at length about it. Otherwise, it will end up in disappointment which may damage the relationship.
4. Know at Length Why He is Borrowing the Money
It happens sometimes that your relative is asking money concealing the truth about the real purpose of it. If you go to the bank asking for credit, will they lend you money without understanding the purpose or your personal details? Just like that, dig a little deep into to understanding the real purpose of money. If that fellow hesitates to open up, give up the idea of helping him right away. If he says that he wants to repay the bank a loan with high interests, collect the details regarding the loan completely.
5. Prepare a Loan Agreement
Unless you get it in writing, you are never safe. Even if he is your close relative or will repay for sure, oral words are not just enough. Get it signed from him to clear all the doubts you have in mind.
In short, lending your relative a little money from what you have is not a wrong thing at all. But how and when you are going to get it back matters. In many cases, the doubt whether one will get the money back is very much disturbing for all those who lend money. So, be alert and follow the above-mentioned tips to make sure that you don't lose even one of your loved ones just because of the reason that you lent him some money.
