The Easy Way vs. the Best Way

This is a guest post from my friend Kraig at Young Cheap Living. This is an awesome post and I know he’d appreciate your feedback. You should also check out his blog, where he shares great information for 20-somethings looking for ways to get ahead financially.

Lately, I’ve been pinching myself to make sure my financial situation is actually happening to me. See, I’ve been working very hard on my finances for almost 4 years now, after learning some major money lessons when I (foolishly) borrowed a lot of money. That hard work has paid off, as I now have a handle on my spending, live on a budget, and have gotten out of debt.

I have close friends and family members who are struggling though right now, though - big time. They have no idea how much different my situation is from theirs since I started paying attention and making good financial decisions. I don’t normally discuss finances with them unless they start the conversation; I’m scared of how I would handle it and what it would do to my relationships with them. It’s kind of a bummer that I haven’t been able to talk to them about money, and I want to figure out how to do it better. Here’s more on their situations:

My Close Family Member Who’s Struggling

I have a close family member (let’s call her Kristy) who has a college degree and is incredibly smart and talented, but has been in a career slump ever since she graduated college a few years ago. She was a victim of the recent economic downturn, which caused graduates to lose hope of entering the workforce with momentum. She earns a full time income but it’s barely enough to survive on.

Recently, I saw two of her bills. Both were several hundred dollars, and both were past due. One of these bills was just flat out careless and could have been prevented (it was an overage on her cell phone plan). I’m aware that she has also racked up close to $1,000 in credit card debt in the past year.

Here’s my frustration. I don’t think Kristy wants my advice on any of this. I’m very aware that she is drowning in her bills and can’t pay them. At the same time, I’m aware that she does make enough money to live on. It’s very hard to watch.

My Close Friend Who’s Struggling

Next is my close friend - we’ll call him Brian. He lost his job a few months ago, just after moving in with his girlfriend. Because of his prior lifestyle (spending everything he made), he instantly had no money because he had no savings at all. He is now living off of his girlfriend.

Brian told me the other day that all of his tax refund will be going to pay his girlfriend’s credit card bill, because he has convinced her to charge everything of his for the past few months (he either doesn’t have credit cards or they’re maxed out). Apparently, she has charged over $2,000 in the past couple months for him.

After he told me that, he said this: “It cost $700 alone to go home to my parents’ house for Christmas.” Note from me: One tank of gas would have gotten them there and back. They also stayed at his parents’ house and ate their food. After her said that, I stepped in and said, “Going there does NOT cost $700.” Then he mentioned it was gifts for his family that cost so much.

So basically, my friend, who has thousands of dollars racked up on his girlfriends credit card, who is flat broke and has very little income coming in (from a part time source), is spending $700 on Christmas presents. That’s VERY frustrating for me to hear and not be able to comment further.

My Thoughts on Helping Them

Obviously, I care about these two people, but don’t know how to help. Here are some options that I’ve thought of and my personal opinion on each:

1. Give them money. I don’t ponder this for my friend often, but I do with my family member. I could write a check and pay those two past due bills; honestly, I wouldn’t even notice the money was missing. It would be easy for me and obviously for her, but in the long run, I believe it would hurt her. I feel like she needs to figure this out on her own. My friend obviously has his girlfriend there to give (or lend) him money. Thankfully, he hasn’t asked me to help him out financially. I do, however, need to be prepared for the possibility that he might someday. I’ve thought that through, and my answer would/will be no. I’m not sure on my answer for my family member, though.

2. Get in their business about it. I could very well stick my nose into both of their finances and give them my two cents. I could tell them both how they’re overspending and living foolishly without the money to do it. Both of them are living a more expensive lifestyle than I am, and both are spending more than me, therefore I know they are spending unnecessarily. If I tell them what I think, I could damage my relationship with them, though, so I haven’t done it at all up until this point.

3. Wait until they ask my opinion. This is what I’ve been doing. Their financial hardships have been going on for awhile, long before their immediate situations happened. They haven’t asked for my advice - yet. Part of this may be that they have no idea how well I’m doing financially, or that I have any ideas for helping them out of this mess (which I do). I haven’t shared any of this with them for fear it would come off as bragging. All I really want to do is tell them how much tightening my belt, budgeting, and getting out of debt has CHANGED MY LIFE for the better!

Therefore, I turn to you, readers. How can I help my family member and friend? I really care about them and want to help them, but have not figured out how to yet. Have you ever been in a similar situation? If so, how did you help that person?

47 Responses to “The Easy Way vs. the Best Way”

  1. Shaun @ Money Cactus says:

    In my experience people can't be told, they have to work things out first for themselves.  Making them aware that you are willing to help and know you stuff is about the best you can do aside from warning them about the perils of debt.  Money and family / friends always makes for a tough discussion.

    • Kraig @ Young, Cheap says:

      Thanks Shaun. The question that remains is, yes I'm willing to help, but in what ways? They may hear that as I'm willing to pay their bills for them and I wouldn't want that.

  2. Tushar Mathur says:

    I think if you just say "Let me know if you need help with your finances. I have learnt a thing or two in the past few years and maybe I can help."
    This way, you have offered help. So you won't feel too bad.
    You think that might work?  

    • Kraig @ Young, Cheap says:

      I think it might! I'm thinking I may have to choose a different word than "help" though. It's possibly a little too ambiguous.

  3. Bogofdebt says:

    Something I am having to do is set a good example.  I have friends who tell me they can't afford to pay their water bill, and then in the next breath tell me about their awesome concert tickets they just scored.  So what I try to do, is lead by example.   I talk about budgets and plans that I have.  I show them that we can still have fun even though we budget and are paying down debt right now. But I stress that our fun is delayed-we save up for whatever we want and at the same time, we save and pay down debt.

     I've also let them know that if they ever want help with their budget (I will not give them money as I'm pretty sure I know that it will be wasted and then they will just need more) they can come to me.  But I don't badger and I don't pressure.

    • Kraig @ Young, Cheap says:

       Thanks for the advice. That's perfect for this situation. I need to set an example by talking about my budgets and plans with them and offering to help them with their budget (even though we all know they don't have one). Who knows, maybe this strategy will get them motivated to make one, too!

  4. Michelle says:

    I would just let them know that you're there to help if they need it. Some people can be extremely stubborn with money so you might have to wait for them to come to you.

  5. scarr says:

    I have been in those places before - brokey broke broke and not very smart about it. My parents are so good with money and taught my brother and I a lot about managing money and staying out of debt. But of course I had to find out myself how much fun debt and late payments are.

    I can only say I wish I would have listened to my mom. However, I have changed for the better and am 17 months reformed with six months wroth of savings and ZERO credit card debt. This way is so much better than the other way!

    • CONGRATULATIONS!!! You're just a little further out than I am - I've been behaving myself for about 15 months. Yay for recovery!! Did something in particular cause you to make changes?

      • scarr says:

        I was in a similar place as you were when you left your job a few months back - I was working at a HORRIBLE place, it paid alright but it was so emotionally exhausting I just could not deal with it, so I quit. I quit with no savings and THOUSANDS of dollars in credit card debt. Oh, and my lease was up and I was practically homeless.

        I was really pathetic at the time, but I decided I was finally over credit card debt and self-pity. I found a better job, my aunt and uncle let me move in with them rent free, and I worked and worked as much as I could and picked up overtime whenever possible. Oh, and I started using a check register - which was a rude awakening. I just hit the point of no longer wanting to live in a financial toilet bowl. It only took 27 years :)

        • That's exactly how old I was! I'm pretty sure that makes us recovered debt twins or something. We should make a secret handshake.
          If you ever want to share your story, send me an email and I'd be happy to feature a guest post from you! Sometimes the readers like to hear from someone other than me and my loud mouth. :)

          • scarr says:

             haha yea the 27 debt club handshake!

            I will think about your offer - I would love to help anyone who wants to get out of debt and learn how to be a financial adult.

    • Kraig @ Young, Cheap says:

       I'm so glad to hear that. Congratulations!

  6. Rachel says:

    I think money management is something you have to figure out for yourself. It would be great if you could learn it in a classroom, but from my own experience the school of life was the only way I would learn. Until a person is ready to change, all the help in the world won't be enough. I would let them know that you've been where they are, and it doesn't have to be that way, and if they want help figuring out how to get out of that place, you'll be more than happy to provide it.

    • Kraig @ Young, Cheap says:

      Great advice. That is the truth, I have been where they are. I don't think they realize that so I better do a better job of showing them!

    • DebtnTaxes says:

      Rachel, I was going to write what I think, but you basically just wrote it for me.  Totally agree with you on this, you can only help someone who wants to help themselves.  Which can be frustrating and hard to do at times.  My brother is in a bad financial situation, and I also don't know how to help him without coming off as rude or bragging. 

  7. I've told this story before, but my sister bought me a Suze Orman book for my college graduation. She tried to make it seem less insulting by saying that it really helped her, so she thought I might get some good info from it. (Still doesn't excuse the fact that Suze Orman wrote it, but anyway…)

    Maybe you could do something similar - give them a personal finance book that you find helpful, and just say something like, "Don't take this the wrong way, but I learned a lot from this book, and I wanted to give you a copy in case you can use some of the info."

    • DebtnTaxes says:

      Small world, I read a Suze Orman book a while back when I started investing.  I can't remember what it was called, but when I took it with me on a trip to his house and "accidentaly" left it there.  He called me later to tell me I had forgot it and I told him that I had just finished reading it so I wasn't in a hurry to get it back.  I'm pretty sure he never did read it.   I plan on giving him Dave Ramsey's The Total Money Makeover for his birthday, because I really think it can help him, just not sure how to go about giving it to him without it coming off as "dude, you got money problems".

  8. kim says:

    You really can't help people who have their heads buried in the sand unless they ask.  Rescuing people with poor money skills is like trying to stop a sucking chest wound.  They don't get it.  I did not get it and you did not get it.  For a long time we struggled and did stupid things with money.   It is a painful slow process to get your financial house in order.  Worth it but also painful.  All you can do is suggest ways for them to help themselves and then listen.

  9. Quest says:

    Although you mean well, there is nothing you can do about other people and their choices.  The only thing you CAN do is to be there for them when and if they ask you for your help.  Otherwise, you are flogging a dead horse.  People have to learn through their own mistakes.  You cannot make their mistakes for them.  Unfortunately, your family member and/or friend may not ever wake up but that's their business.  Just about the only thing you CAN do is to lead by example.  Make it known that you live on a budget and that you have no debt and see where that leads.  Perhaps one or other of them will ask you elaborate further.  Good luck!

  10. Young Professional F says:

    I agree with the other comments - they need to work it out for themselves. Definitely make it known that you're available if they want to talk, maybe bring up your story in a non-related way. "It doesn't feel like it was that long ago when I was in debt and had no emergency savings. *give some details* I'm just glad I have the breathing room now but it was so hard to dig myself out of that." That way you kind of plant the idea that you were in a similar situation before and now you aren't - maybe they'll think of you the next time they have financial questions. Unfortunately, there's not much more you can do for them.

    • Kraig @ Young, Cheap says:

      It's such a bummer that I can't help them out of this easily. You're right though, they have to work it out for themselves.

  11. Shawanda says:

    When it comes to close friends and family members, I have no problem telling them what I do to manage my money. I won't pry into their affairs, but if they're complaining about how they don't have any money, I'm gonna say something. They can accept my thinly veiled advice or not accept it. Ignoring my financial advice only upsets me when you ask to borrow money from me. So, you can disregard me as a cheap, crazy person at your own peril. We'll still have a lovely relationship. Just don't ask me for money. 

  12. Bridget says:

    I wouldn't get involved unless asked.

    My dad always says, "you have to let people ruin their own lives" — which sounds harsh but really just means don't intervene, even with good intentions. Sometimes being a good friend doesn't mean stopping the process, but just being there to pick up the pieces when it's over.

    • Kraig @ Young, Cheap says:

       Aw.. that's deep but true, Bridget. Like I said above, it's so sad that there's nothing I can do to get them out of this mess.

  13. Teinegurl says:

    How about at another time when their not talking about money say oh! i had something i wanted to show you! And show them what your doing with your budget and how it working for you like how excited you are so it makes it about you and not them. Maybe they will get the ideas from you and use it, or ask for help from you because they know that you've been there. Or they next time they complain say oh i know how that feels but what worked for me was _____ fill in the blank

    • Kraig @ Young, Cheap says:

       Great idea. As far as them complaining, they really don't complain to me, which kind of makes it hard for that perfect opportunity to arise for me.

  14. Jesort415 says:

    I agree with the lead by example then offer your help not your money approach!!

    Boy I wish I had a friend/family member/stranger like you 12 years back. I was a typical Princess, made a decent living, had my own apartment, a newborn, and shopped with "free" money all the time (aka Credit cards).  In my defense I wasn't recieving child support, not in my defense my living expenses were 800 a month (Thank Goodness for my fab in laws for free babysitting) and I made 2500 a month so really no excuse!  Anyway the only example I had was my mom who at 21 was a mom of 2, FT college student on assistance, and filing Bankruptcy.  I had no example on what to do but plenty on what not to do (in all fairness we lived in a really run down area of Bklyn NY so no one around us had anything) so I followed the foot steps of my mom. Fortunately she wised up and I again followed her and now we are both much better off with Mom recently buying her first home, the first of my immediate family to own her own home.  Hubby and I will probably be next but not anytime soon.

  15. Kris @ BalancingMone says:

    This is a tough one - when we were really struggling, I wasn't ready to listen to anyone, and I honestly didn't want "help" either (stupid pride!). I like the idea of of you talking generally about how well your budget works, etc - then if they are ready to change, they may feel comfortable asking you for your advice because they know you have it together.

  16. A Fistful O'Dol says:

    I agree with other commenters that these people need to "ruin their own lives" as Bridget's dad put it! However, nobody's mentioned the fact that if you just gave them the money, it wouldn't solve the problem. You most likely wouldn't see that money again, and they would most likely try to hit you up for cash again in the future. They need to be cut off, and only then will they hit rock bottom and start to dig themselves out (hopefully).

    • Kraig @ Young, Cheap Living says:

      I completely agree with that. That they need to hit rock bottom on their own. And that giving them money will not help a bit.

  17. Jessica says:

    I would offer the help with just a casual "Hey, if you ever need some advice on making ends meet on a tight budget, I'm here to help." type of conversation. Don't solicit advice just the knowledge that you can help if he wants it. 

  18. Sarah says:

    I think giving a good example is the best thing you can do. It's a perfect mix of somehow letting them know you can help but also not pressuring them.

    I was in a slightly similar situation with my boyfriend. He wasn't struggling financially, he only spent the money he earned, but he wasn't budgeting so he could see no room for savings, long term goals and an emergency fund - and he didn't have health insurance (in our country health insurance is not mandatory though very highly recommended). I didn't want to tell him off about it because I wouldn't want it to look like I was sticking my nose into his finances. But recently, I turned from overspending to budgeting and saving myself. I was very excited about my recent accomplishments and I talked to him about it. Five minutes later he came to me and said "you know what, you could help me do it too!". Of course this was easy because we're very close, so it didn't feel weird telling him about my financial situation and because he was already someone who worried about money, he just needed some encouragement to do it better.

    If this doesn't work for you, I bet at some point these people will need to talk about it - either to ask you for money or to talk about bankruptcy. Probably it will be much later than you'd like, but as things get worse it will be easier to start that conversation.

    • Kraig @ Young, Cheap says:

      That's a great story. I'm glad that it worked out for you and your boyfriend. Thanks for the advice as well.


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