Families are great. They are the first ones to come help, and the last ones to leave us when we are in trouble. When we were young, we lived with our families, and we start our very own later on in our lives.
Families however, make money matters even more complicated. Let’s face it, money is important to us, and anything important can potentially create conflicts. Most people enjoy a very good relationship with their families because there is no money conflicts; for others, money (or the lack of) can become a sticky subject.
Most people believe that the lack of money creates conflicts, but having money is just as troublesome. When parents have money, sometimes their children will try to fight for the inheritance, directly or indirectly. This is one of those unfortunate events that we all dislike when we hear it, but we see people do this time and time again. Another example is when our family members are in trouble and we become the “defacto” go to person for free loans.
So, if having money and not having money both creates conflicts, what should we do?
Here’s what I suggest. Although we cannot eliminate conflicts completely, we can drastically reduce the possible fiction points by being able to sustain our own finances. If we cannot stop everyone else from asking us for money, at least we can stop asking others for it. This also means taking the appropriate risks with our finances, and doing our homework so we are prepared for the consequences.
For business owners, this means they expand at a controllable level. For the rest of us, this means that we be responsible and create an emergency fund. Not gambling excessively or buy a house that we never really could avoid (something far too many did the last few years) also comes to mind.
If we don’t need financial help from our family members, I bet our family life will improve too! Money matters, but family matters a great deal too. So create a happy financial situation, and relieve the potential stress it will have on our families relationships!
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{ 7 comments… read them below or add one }
well, if you ever need to borrow money from your family (or feel compelled to lend money to a family member), set up an “official” loan via Prosper or Virgin Money. You are doing both of you a favor by doing that.
I think everyone just gets touchy when it comes to money. Family or not.
Money issue shoudnt be a cause of conflict especially for a family. Relationship is more than just a material thing.
Moreover, if a family member come to you for money exactly for the expectation that he does not need to repay it later, it become a big moral hazard problem and is bad for both of you.
Well said. My dad and his own brother have been engaged in money conflicts. More money is always trouble. So whenever its a plan of more money. Alone or working with trusted people is the best option.
@ Miracle
Not really.
I have found it is best not to mix money/business with family and friends. It seems to always divide.
Best Wishes,
D4L