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How to Give Money to a Loved One in Financial Need. It's not always a good idea to lend
money to family or friends, but there's a way to get it right. You will need A loved
one Money Willingness A contract and a third-party collector (optional). Step 1. Determine your
capability to lend the money, and do so only if your own finances are in order and your
bills are paid. Step 2. Determine if you are uncomfortable with lending the money or feel
pressured. It may come back and hurt the relationship. Consider making the money a one-time gift
instead of a loan if you are worried that payback might complicate the relationship.
Step 3. Be upfront about interest payments and when the loan is due. Step 4. Put the
agreed terms in writing and make sure both parties have signed copies of the contract.
Consider using a third party – a lawyer or other intermediary – to oversee collection
of the debt. Step 5. Educate yourself about tax issues related to loan interest and gift-giving
so that you are aware of any additional tax burden or write-off you might incur. Did you
know In The Inferno, Dante described a special section of Hell that was reserved for usurers,
money lenders who charge exorbitant rates of interest.