Filipinos have very close family ties and as a child, I was raised to honor this tradition. And since this is a big part of our cultural upbringing, it is often considered inappropriate to decline giving financial support to family members and relatives. I was able to talk to one of my friends regarding this issue. I specifically asked for his reasons why he agreed to finance the education of one of his cousins despite the fact that he already having a difficult time being the sole breadwinner for both his parents and a younger brother.

He relates, “Nakakahiya kasing tanggihan ‘yung Tita ko, isa kasi siya sa mga nagpalaki sa akin ‘nung nasa ibang bansa pa si Nanay. Nakakaawa din naman ‘yung pinsan ko kung hindi makapag-aral eh matalino pa naman. Okay pa naman ang budget ko, kaya ko pa. Konting tiis na lang din naman ako kasi two sems na lang, graduate na ang ang utol ko at pag nakahanap na siya ng trabaho, makakatulong na rin siya sa akin.” (I find it difficult to say No to my aunt. I feel indebted to her because she was the one who took care of me as a child when my mother was working overseas. I also pity my cousin because she’s smart and I don’t want to her to stop going to school. My budget can still manage it anyway. And besides, my brother will be graduating in two semesters. When he finds a job, he can finally help me.)

If you were in my friend’s situation, would you have done the same thing? Lending out money or giving financial support to family members and relatives is often an emotional experience. Nevertheless, I think that we should learn how to handle the situation as objectively as possible. By letting our emotions and pity control our decisions, we could end up in our own financial mess.

A few weeks ago, I wrote an article on how to handle friends who borrow money. I recommend that you read that first before you proceed because most of the advise that I will dispense below are based from what was discussed in that post.

Going back to our topic, we now continue by asking ourselves this question: So how do we carry ourselves when faced with a family member or relative who’s asking for financial support?

If you’ve experienced being asked for money by a relative, I’m sure that you know that these situations typically start with the telling of a sad story. Listen with an open heart and empathize but do not promise anything. Show genuine concern and ask questions so that you’ll fully understand the circumstances that led them to ask for your help.

After that, tell them that you would need some time to think about it. Be clear that the reason why you’re asking them to wait is because you want to assess your finances. Make them understand that you’re currently not in the best position to commit to anything. Furthermore, be sure to give them a reasonable date when you’ll have your decision and offer to be the one to call them on that day. Doing so will lessen their anxiety and likewise assure them that you are sincerely willing to help.

You’re next step is to naturally assess your own financial situation if you could afford to give your support. Again, we realize the value of tracking our expenses and the importance of having a personal budget. You should also be aware that it may seem that you can afford to lend out the money now but don’t forget to consider your needs in the coming weeks or months.

Once you have thoroughly assessed your financial capabilities and found out that you could afford to extend your help, then arrange to make the payment directly to their need. What does this mean? In my friend’s case, rather than giving her aunt the money for his cousin’s tuition. He writes out a check payable to the school. Likewise, rather than giving his cousin allowance for books and other school requirements, he asks her to give him the list and buys them personally. This will ensure that your hard-earned money is being put to proper use instead of being spent on unnecessary expenses.

Lastly, don’t expect to be paid back. Even though they might say that they will return the money someday, in most cases, it never happens. Whatever financial support you extend should be considered a gift rather than a loan. This way, you avoid family rifts and unnecessary feuds. If you cannot afford to lose the money, then the best option might be to offer non-monetary support.

So what should you do if after seriously considering your personal finances, you found out that you cannot afford to help? How do you say NO? First, make them understand your situation and explain to them your own financial goals. Be sincere and diplomatic. Moreover, be willing to offer support in another way such as helping them find income opportunities and teaching them financial responsibility. To restate a famous saying, “Give a man a fish; you have fed him for today. Teach a man to fish; and you have fed him for a lifetime. But teach a man to sell fish and he will eat steak.”

What are your thoughts about this topic? Kindly share them by giving your comments below. Moreover, I shall be turning the tables around soon by teaching you how to properly borrow money from family, relatives and friends. To make sure that you don’t miss that article, subscribe to Ready To Be Rich.

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Photo courtesy of doc18