Before offering financial advice to those you love, it’s important to first ask if that’s what they want. Discussing financial matters with family and friends can be a tricky proposition. Sometimes people are just looking to talk through their fears and concerns so they can clear their mind enough to formulate their own plan of attack. If they indicate that they would love some direction, however, the following advice can be of great value:
1. There are non-profit lenders who provide interest-free finance
So many people struggle through financial hardship with no idea that they could apply for a no interest loan scheme. If a friend or family member is in a tight spot with money, one of the best things you can do is put them onto a reputable non-profit lender who can help them pay for unexpected expenses without the burden of extra interest.
2. Budgeting doesn’t have to be frustrating
This is a tricky topic to bring up as many people roll their eyes the moment the word “budget” is mentioned. It may not be the most enjoyable activity on the planet, but it is an essential tool, especially if someone is in fiscal strife.
The best advice you can give here is that budgeting doesn’t have to be a confusing or annoying task. There are plenty of apps and online tools that take the hard work out of organizing your finances. Point your loved one in the right direction, and they’ll be grateful for the clarity it will give them about their situation.
3. Creating bite-sized goals will help with motivation
Sticking to a budget and a debt reduction plan can be difficult, especially if you have to go without some of your favorite little luxuries. If a loved one is struggling to stay motivated, it’s worth suggesting that they create some mini-milestones along the path to their greater goals.
Studies show that big goals that will take a long time to achieve can feel so impossible that people give up on them. However, the quick results offered by smaller goals offer regular motivation boosts that can be enough to keep someone powering through even the toughest times.
4. Never stop learning
This advice applies as much to finance as it does to your loved one’s career and personal interests. There are plenty of libraries and cafes offering free internet access, and with this powerful tool at their disposal, your friend can access the education they need to improve their position. Numerous sites offer free courses in personal finance and many other subjects. Arming yourself with knowledge is the best way to set yourself up for success.
5. Choose a strategy and stick with it
If your loved one is dealing with multiple debts, having a strategy is essential. While it’s important to ensure the minimum payment requirements are being met for all debts, any extra funds should be thrown at either the smallest debt (as it will be the easiest to knock out) or the one with the highest interest rate. Determining a debt reduction strategy can be tricky, so it’s also worth reminding your buddy that there are free debt solution services available.
Offering financial advice to loved ones isn’t easy as you don’t want to come off as condescending or overbearing. However, if you stick to the tips above, you should be able to genuinely help those you care about when they’re having money problems.