Helping a friend or family member in financial hardship
Being there for others in the best
way you can
If you want to support a friend or family member who is having a
tough time, here are some tips about what to do, and services that
may be able to help.
Talking about money
Money can be a very sensitive and personal issue for many
people. It's important to remain unbiased and non-judgmental so the
other person feels comfortable opening up to you about their money
problems. Here are some tips:
- Only ask them about relevant information that you need to know
in order to work out how to help them. Avoid prying into irrelevant
- Put yourself in their shoes and show compassion for the
situation they're in.
- Accept the person for who they are and don't try to change
- Let them know there is support available for them.
Work on a budget together
If you feel comfortable, ask them to bring you copies of their
financial documents, such as pay slips, any Centrelink statements
and bills, so you can go through them together and get a clear
picture of their income and outgoings. The easiest way to get an
idea of their financial situation is by helping them do a
Know where you stand financially.
Find the right support
It can be confusing and stressful to work out where to go when
you need help. The greatest assistance you can give your friend or
family member is to help them find the right support.
- See urgent money help if they need
immediate help with living expenses, such as rent or bills or to
- See no or low interest loans, if
they need help to pay for essential household items, such as a
fridge or washing machine, or to fix a car
- See trouble with debt, if they are having
problems managing debts or dealing with debt collectors
- Use Centrelink's payment finder to see
if they are entitled to any government assistance.
Financial counselling is an
independent service offered by community organisations, community
legal centres and some government agencies. Financial counsellors
help people in financial difficulty. They provide information,
support and advocacy for people with immediate financial problems
and minimize the risk of future problems. Their services are
If you know or suspect that some of your friend or family
member's financial problems are due to another person running up
debts in their name, or pressuring them to spend money or sign up
for a loan, they may be experiencing financial abuse. Visit our financial
abuse webpage for more information, and the contact details of
some organisations that can help.
Think carefully before lending
money to friends and family
It can be really hard to refuse a friend or family member when
they ask for financial help. But it's important to ensure that
helping them won't put you in a difficult financial position. You
also don't want to risk losing a good friend or falling out with a
family member because of money.
Before lending money consider the following questions:
- Can you afford it? Check your budget to see if
you can afford to lend them the money and factor in the chance that
they won't pay you back in time.
- Can they afford to pay you back? Don't be
afraid to ask them how they intend to pay you back and agree a time
- What will you do if they don't pay you back?
While it is a sensitive topic, ask them upfront before you lend
them money what will happen if they don't pay you back on time.
Make sure you are comfortable with their response and seriously
consider how not getting the money back will affect your
- Are there other ways you can help? It's ok to
say no to a friend or family member who asks to borrow money. There
may be other ways you can help out. For example, you could offer to
babysit their children or help cook or clean so they can attend
work or meetings, or you could lend them tools, appliances or even
your car so they can save money by not having to buy
Get it in
While it may seem overly formal, it is wise to write down any
agreement if you decide to lend money to your friend or family
member. Include the amount of money they borrow and the agreed
timeframe for them to pay it back.
Take care of yourself
Providing support for someone in financial difficulty can be
difficult and emotional. Make sure you set clear boundaries about
how involved you get in another person's life. It's important to
seek support and comfort for yourself as well.
If a friend or family member is having
problems with money, it's natural to want to do what you can to
help them. Talk to them about the issue and find out what services
and support are available.
Last updated: 16 Jan 2020