Our finances are becoming increasingly tight and we have to make decisions. How can we politely decline a trip that’s too expensive for our budget or say no to a loved one who wants to borrow money from us?
Times are tough for many people and some have no choice but to turn to their loved ones to make ends meet. If you are asked to borrow an amount but you are unable to do so, how should you respond? But how can you say no to a trip with friends that would force you to go into debt and use your credit card? Times are tough for many people and some have no choice but to turn to their loved ones to make ends meet. If you are asked to borrow an amount but you are unable to do so, how should you respond? But how can you say no to a trip with friends that would force you to go into debt and use your credit card?
Help the person find a solution
Financial wellness speaker and coach Barbara Demers, co-author of the book “Money and You,” emphasizes that it can be difficult to manage a loan application if you have an emotional attachment to the person because they are a family member or Friend. “It’s sensitive because we would like to be able to help him, but we are not financially able to do that,” she says. In any case, you should not put yourself into financial difficulties to help a loved one.
Instead, she recommends putting aside your pride and simply telling the truth. “You need to be upfront and mention that you cannot afford to lend him the amount he requested. “In general, the person will understand and not be angry,” she assures.
She also recommends putting yourself in solution mode to support your loved one in ways other than money. “We could explore other options with him, such as applying for a loan from his bank, helping him review his budget or, in particular, taking on a second part-time job,” she lists.
Regain financial independence
There is a saying that it is better to teach someone to fish than to give them fish. This saying makes it clear that it is better to accompany someone on the path to autonomy and teach them to manage themselves – which is a long-term solution – than to solve a problem temporarily with a loan or donation.
The other essential point is to determine the cause of the financial difficulties of the person applying for money. “I see that the biggest problem for many people is that they don’t know what they’re spending,” notes Barbara Demers. By noting every cash outflow for a month, you can take stock and know where your income is going. We can then help the person review their budget and make cuts where possible so they can finally get back on the path to financial balance.
Bet on the franchise
There is no shortage of temptations to consume and spend. And it’s even worse when friends or relatives ask you to go with them to a restaurant, do an expensive activity or even go to their wedding that is going to take place… on the beach of an island in the Caribbean!
Nothing requires you to go into debt to do it. The same applies here: Don’t hesitate to be open and express your opinion completely honestly. “Explain that your budget does not allow this and that unfortunately you have to decline the invitation. On the other hand, you could suggest alternative solutions, because ultimately it’s about being together,” suggests Barbara Demers.
A cheaper alternative is to have a meal with friends at home, where everyone can contribute by bringing a dish or a bottle of wine. Additionally, it’s easy to find free or low-cost activities in your area or community. And if you can’t attend the wedding in the South, why not offer a cocktail dinner when the bride and groom return, taking the opportunity to present them with their wedding gift, taking your budget into account of course?
Final advice from Barbara Demers: “Before saying yes to a request that costs money, you must first and foremost respect yourself.” It is a healthy practice and will save you a lot of financial stress,” she concludes.
ADVICE :
- It is not always a good idea to lend money to a loved one, even if you have the means to do so, as you may end up having a dispute with the person if, for example, they are unable to pay you back .
- If not repaid, this loan can also put you in a bad financial situation and damage your credit report.
- A loved one asks you for a guarantee or surety for a loan? Think twice because you could be held responsible for this debt if he fails to fulfill his obligations. This will also affect your debt-to-income ratio and possibly your credit report.
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