Steps to offering a financial lifeline

There are many reasons why someone might be struggling financially. Job loss, health challenges, or a sudden financial emergency could cause hardship, preventing someone from staying afloat. In times like these, it’s not uncommon for someone to ask for help from friends or family. Before agreeing to help, make sure you will not be putting your own financial future at risk.

On this page we answer:

Why might someone need a financial lifeline?

When someone is going through a tough time, it can mean they need to make major adjustments to household finances and lifestyle. Various personal and financial obligations can be affected, including mortgageMortgage A loan that you get to pay for a home or other property. Often the loan is for 20 years or more. You make a set number of payments for a set amount each year.+ read full definition or rent payments, debtDebt Money that you have borrowed. You must repay the loan, with interest, by a set date.+ read full definition payments, monthly bills, groceries, or keeping up with seasonal needs and gift-giving. They may be dealing with these challenges while also searching for new employment or a new place to live.

If you’re thinking about offering someone help, first make sure that you’re genuinely able to do so.

As hard as it may be, you need to make sure that your own financial future is secure before agreeing to help a family member, friend or caregiver.

How can you help a loved one who is struggling?

Everyone’s life is different. And the kind of help someone might need will be different too. It’s a good first step to understand what kind of assistance would be truly helpful.

Sometimes you know someone is struggling, and you want to help, but you aren’t sure how. A good first step would be to have a conversation with them to check in. If they ask for help in a specific way, then you’ll have a better idea of whether that support is something you can manage. Before committing to giving a financial lifeline, think it over first. And perhaps check with your financial advisor to determine what you can manage.

There are ways you might help without offering money. This could include:

  • Talking it out. Being a supportive listener can help someone process the challenges they’re going through. You can offer empathy or brainstorm solutions together.
  • Connecting to the right people. Consider who’s in your network. You might know employment specialists, counsellors or therapists, trainers or mentors, real estateEstate The total sum of money and property you leave behind when you die.+ read full definition agents, or other professionals whose specialized skills could help your friend.
  • Helping to create a plan. You could offer to look at their financial situation, together. For example, reviewing bills or budgets and helping them prioritize. Sometimes it can help to have someone as a partner to plan for the next best steps.
  • Offering non-financial assistance. Depending on your skills and lifestyle, you might be able to lend a hand without giving them money. This could include sharing meals, giving gift cards, offering childcare, or providing a ride somewhere

There are many good reasons to help a friend or family member in need. But it’s just as important to ensure you stay within your limits. Don’t try to stand in for professional support if it’s not within your skill set. It’s important they connect with a professional, such as a psychologist, debt counsellor or a registered financial advisor, if  that’s the type of help they need.

How do you know if you’re able to offer financial help?

It’s not easy watching someone you care about struggle financially. And wanting to help is human nature. But relationships can be complicated, particularly when money is involved. If a friend or family member asks you for money, you should review the following:

  • Consider whether you are offering a gift or a loanLoan An agreement to borrow money for a set period of time. You agree to pay back the full amount, plus interest, by a set date.+ read full definition. If you’re providing money to help someone out, do you want them to pay you back? If it’s a loan, consider the terms you’d like to set and talk to the person about that.
  • Check your own net worthNet worth The value of all your assets, less what you owe.+ read full definition. The Net Worth Calculator can help you review your current financial situation. Check your most recent investmentInvestment An item of value you buy to get income or to grow in value.+ read full definition accountAccount An agreement you make with a financial institution to handle your money. You can set up an account for depositing and withdrawing, earning interest, borrowing, investing, etc.+ read full definition statements. Have you incurred investment losses or taken on new debts? How much?
  • Check your budgetBudget A monthly or yearly estimated plan for spending and saving. You work it out based on your income and expenses.+ read full definition. Consider whether your own situation has changed recently. Has this affected your retirement plan? Our Budget Worksheet can help you confirm whether your plan is still on track or needs adjusting.
  • Check your retirement cash flowCash flow The sums of cash a business gets in and spends out during a set period of time.+ read full definition. If you’re retired, be sure to consider your cash flow needs. This can include government and private pensions as well as any investment income you might need now and in the future. Try our Retirement Cash Flow Calculator to get a better picture.


Helping someone in a tough situation can include financial help or other kinds of support. Before offering financial support, you could:

  • Check in on the person to better understand their situation.
  • Consider non-financial help you could offer, such as childcare or a listening ear.
  • Check your own financial picture, including your net worth, budget and retirement plan.
  • Determine whether you’re offering financial help as a loan or a gift. And make sure the person you are helping understands that.
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