Tips for the family banker

Are you the family banker? Often a family member is the "go to" person when relatives need money. Here are a few things husbands and wives need to do to get themselves off the payroll!
1. Ask yourself, "Can I afford this?" Be honest. Don't give money that you need for your own financial stability or retirement.     
2.  Say no when necessary and discuss other options.
3.  Be honest with the family member. Assess the financial problem. Is this a short-term financial problem? Or is it chronic mismanagement? Advise them on other solutions besides always coming to you or your wife.
4.  Make it clear whether this is a gift or a loan. If you are comfortable with gifting the money, fine. If this is a loan, agree on a realistic payback schedule. 
5.  Help them with a financial plan, including "reality" budgeting.  Reality budgeting takes into account car maintenance and household emergencies people need to plan for.
6.  If it's one of your adult children, decide whether use of the money will actually help the child become more financially independent, I.e., moving expenses for a new job out of state.  Or, is it  money for a new car they don't need and can't afford!
7. Finally, make it a teaching moment. Is this a wise or unwise financial decision? For example, the relative needs money for a down payment on a house.  Has she considered all the monthly expenses that come with a house, and the long-term costs.  Show her how to figure out the pros and cons of large purchases. 
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