Helping Out With Cash: A Delicate Art

Your Money
Helping Out With Cash: A Delicate Art

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By RON LIEBER
Published: March 27, 2009

It was the idea of her friend’s children riding around in the back seat of an uninsured vehicle that finally convinced Mishiko Flores that she had to do something to help.

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First, she asked her husband: Could they afford to give the family money? Then, she practiced her offer with her mother. In the end, Ms. Flores made a delicate approach and, after bursting into tears, her friend accepted the $3,000 gift.

In last week’s Your Money column, I asked readers to tell me how they were wrestling with the question of whether to give — or take — money from those closest to them. The responses poured in from people like Ms. Flores who have offered help and those who have been recipients of financial aid, or who wish they were.

Because so much attention has been on the shortcomings of government assistance, I had not realized how many people were grappling privately with how best to reach out. Still, the volume of replies shouldn’t have been surprising, given that so many people have lost jobs, lost money in investments and watched the value of their houses drop in the past year or so.

And for all the people who are struggling to pay the bills, there are many in their inner circle who have been agonizing for months over how or whether to write them a check.

You can read some of the scores of inspiring (and dispiriting) reader comments on the Web version of last week’s column. We’ve also sorted some of the most thoughtful e-mail replies by topic in an interactive viewer linked from the version of this column at nytimes.com/yourmoney.

Meanwhile, I’ve tackled five of the toughest parts of this money quandary below.

GRANT OR LOAN? Whether you give money outright to those closest to you or lend it, the dangers are similar. Putting money between you can fundamentally and permanently alter the nature of the bond.

Loans are particularly problematic. Debt, especially when it is piled on top of existing loans, adds to uncertainty, especially if the recipients have no idea when they are going to be able to pay it back.

Giving money to someone you know, meanwhile, requires a specific mind-set. Can you truly do it without any expectations or preconditions? And can you do it without resenting what the recipient chooses to do with it?

“The person who is unemployed wants to be sure there are no strings attached,” said Fred Bracken, a New York City resident who recently lost his job with American Express. “There’s a difference between lending a hand and being coddled.”

If there are conditions, make them simple rules that inspire everyone involved. Almost 50 years ago, Rich Wilbanks was moving from Oregon to California with his family so he could start a teaching job. His brother and his wife handed them $300 and told them it was in the nature of a loan but that they would need to repay it by helping someone else.

He and his wife have paid it forward many times over the years since. “You get to pay what you want to whom you want,” said Mr. Wilbanks, who is now retired and living in Berkeley. “You never get a statement about it. It’s your obligation to deal with yourself, somehow down the road somewhere.”

Ms. Flores, the Clifton, N.J., resident who helped her friend, added two other items to the script. First, Ms. Flores reminded her friend that she would certainly do the same thing for Ms. Flores’s family if the need arose. And then, she told her friend that she never wanted to talk about it again.

One year later, the relationship is still intact.

ASK FIRST, OR JUST ACT? It is tempting to offer financial aid only when someone close to you asks. After all, you don’t want to embarrass anyone. But it may be best to risk discomfort, or being turned down, in the event that the person you’re worried about is simply too proud to make the request.

Ms. Flores, who counsels New Jersey state prisoners for a living, said, “A lot of the time, I’ll deal with clients who get into trouble because they’re afraid to ask for help.”

Even when someone does not accept an offer, the act of asking can itself be helpful.

“Just the thought that there is help in the margins means you don’t necessarily have to take it, and that has sustained me,” said Naomi L. Maloney, a copywriter and brand consulting strategist in Oakland, Calif., whose friends have offered her loans. “It makes me work a little bit harder and feel more confident in my self-worth as a worker and as an earner, to know that the help is there if I need it.”

ACT ALONE OR WITH OTHERS? In late January, Steven Roy lost his job, which provided health insurance for his family. A few weeks later, his infant son Isaac, who is known as Ike, was found to have a life-threatening illness. Within hours, friends of the family from the AustinMama Web community in Texas had erected ikeasaurus.com to coordinate help for the family. A few hours later, there was $4,000 in a PayPal account with the Roys’ name on it.

Kari Anne Roy, Ike’s mother, said it was easier to accept the money from a group than it might have been to say “yes” to many individuals. “There is no one we could give the money back to,” she said, given that the money in the PayPal account, now up to about $8,000, is a single sum. “We couldn’t give it back if we tried.”

That said, accepting the money, which the family has barely begun to spend and still hopes not to, has not been easy. “I don’t want to be that family on the tip jar at the sandwich store,” she said. “I feel an overwhelming sense of responsibility. Is it O.K. to buy bottles with the money, or do I need to buy medicine instead?”

GIVE ANONYMOUSLY? If you want to give money but handling it face to face is not palatable for whatever reason, anonymous grants are another option. If you are part of a religious congregation, its leader may be willing to help with the gift.

Sue Barnet of Wetumpka, Ala., arrived home one day in November to find a $200 check in the mail. The bookstore where she worked had closed, and someone from her church had given the money anonymously to her minister and asked that he forward it.

Ms. Barnet said she was so amazed that she had to sit down at her kitchen table.

“I couldn’t believe that someone in our congregation thought enough of me and had enough faith in me that they decided to do something really practical to help,” she said. “I come from a family of extraordinarily independent women, very determined. Sometimes that’s not such a good thing. I think I would have just been too embarrassed to accept a direct gift.”

Thanks to a new part-time job at a public library, Ms. Barnet is beginning to recover financially. She said she planned to donate to her church’s discretionary fund, which her minister could use to help others in need.

Another way to hide your identity while giving is through the Giving Anonymously Web site, givinganon.org. The nonprofit group will send an anonymous check on your behalf and record thank-you messages from the recipient.

CASH OR DIRECT PAYMENT? As a general rule, plain money is the most flexible gift there is. There are no limits on its use, as there is with a gift card.

If you can’t spare money right now, giving frequent-flier miles to people who might not otherwise be able to afford a vacation or a trip to attend a funeral is a nice gesture.

Several people wrote in to suggest one final idea: giving to the children of adults facing financial distress. Paying the provider directly for a music lesson or a week of camp feels less like an act of charity and has the added benefit of allowing those who disapprove of the parents’ spending or other choices to keep their children from doing without.



http://www.nytimes.com/2009/03/28/your-money/28money.html?em