If you know someone who is having a hard time with their finances, you might feel helpless watching them struggle. But there are ways to help. Talking about someone else’s financial difficulties is delicate and it’s important to approach the topic with empathy. Here are some considerations and tips to keep in mind when you approach a friend or loved one whom you want to help get out of debt.
Be sure there’s a problem
Money is about more than the dollars in a bank account—it’s about emotions. Think about how an unexpected medical bill or a car repair might make someone feel panicked, embarrassed, or depressed. If you’re worried about someone, it’s important to show that you care. But before you approach the subject, try to understand if there’s a problem.
Here are signs that someone you care about might be struggling with debt:
- Previous issues with debt: Have they confided in you about debt problems in the past?
- Expensive “must have” things: Do they always have the latest tech gadget, but recently mentioned being worried about filling up the gas tank?
- Never talks finances: If money comes up in conversation, do they quickly change the topic? They may avoid financial discussions out of embarrassment.
- Altered spending habits: Are they suddenly saying “no” to going to their favorite restaurant? Or do they now overspend on luxury items using a credit card?
- Exhaustion or insomnia: Have they talked about being exhausted or not sleeping well? Difficulty sleeping can be brought on by financial stress.
- Major life changes: Have they lost a job? Did they have a baby? Has their spouse died? All of these can tighten finances.
- Emotional changes: Are they reducing their social activities? Do they seem withdrawn, anxious, or depressed?
- Mentions money concerns: Did they say they’re living paycheck-to-paycheck, behind on bills, or running up debt?
If someone you care about is exhibiting many of the above signs of distress, then it may be time to have a frank conversation where you provide sound guidance about debt. Here are seven tips if you’re going to talk to someone you want to help get out of debt:
1. Help, don’t judge
When you bring up the topic of debt, be aware of the tone in your voice. You want to come across as caring, not as a know-it-all. So, avoid the tone of “I know everything, and you should do it this way,” as that probably won’t be productive.
2. Reach out and ask
If someone has mentioned money worries, it may be a request for help. Directly ask if they’re concerned about money. Or tell them how something you’ve observed them doing causes you to worry—like shopping all the time or traveling every weekend. Let them know you’re concerned and ask if there’s anything you can do to help. But be mindful that if they say “no” or seem to ignore your inquiry, it might be best to drop the topic for now.
3. Mention your own debt history
Sharing how you’ve been in a similar debt situation and found it overwhelming and stressful can help someone know that you fully understand. And explaining how you got out of debt can offer a ray of hope as well as practical steps for obtaining a healthy approach to finances.
4. Don’t be part of the problem
Whether it’s going to dinner, a movie, or even a cup of coffee, these are expenses that someone with debt might not be able to afford. And they may feel upset about saying “no thank you” all the time. But people in debt still need a social life. Offer ways to hang out that don’t require spending money, like going for a walk, a bike ride at the park, or watching a movie at home.
5. Offer accountability
Whether it’s an exercise program or a financial diet, many people are likely to find success when they’re accountable to someone else. For example, you could encourage them to create a budget to help get out of debt faster. Offer to help them by setting goals, having check-ins, keeping them motivated, and celebrating their successes.
6. Avoid the quick fix handout
Even if you have the financial ability to help your friend, that may not help them with debt in the long run. First, while generous, a financial handout can make them feel indebted to you. Second, taking ownership of their debt and deciding on the best course of action to tackle it can help ensure they learn to manage money more effectively in the long run.
7. Recommend a debt relief program
Suggest they look into a debt relief program. Such programs can help them reduce the amount they owe and put the debt behind them faster than they could on their own. Even just making that first phone call for a debt evaluation could help reduce feelings of stress and overwhelm.
Suggest a debt management guide
Wanting to help someone get out of debt means you care. And it’s ok if you don’t have all the answers because learning how to deal with debt, money, and planning for your future doesn’t need to be hard. At Freedom Debt Relief we’ve developed a simple to follow guide to help people find the tools they need to move to a better financial future. Learn more by downloading our free guide right now.
- Thinking of Lending Money to a Friend or Family Member? Read This First (NBC News)
- How to Get Out of Debt (Freedom Debt Relief)
- 5 Strategies to Deal with Financial Stress (The Balance)