Some people get into financial trouble helping others. Are you one of those who give too much to family, friends, and even strangers? Take these steps to protect your financial future.

In debt? Credit cards maxed out? Credit score circling the drain?

So often when people have a lot of debt, no money and a poor credit rating they are thought of as living extravagantly. People think they must be doing all of the things that one isn’t supposed to do with their money such as taking lavish vacations, wasting money on frivolous trinkets or shopping excessively for themselves.

But there is one group of people who do not fall into this category. Believe it or not, many of these people aren’t indulging themselves. Let’s call them “those who give too much.”

Can You Relate to These Giving Scenarios?

People who give too much indulge everyone except themselves and they make up a sizable population of those suffering from debt.

Divorced parents who try to make up for their broken family by spending money they don’t have on their children. Or parents and grandparents who co-sign for cars, boats, motorcycles, even houses and businesses for their children and grandchildren and get stuck holding the financial bag. People who can’t ever say no to charity drives and homeless folks.

Sound familiar?

How Do You Know If You Are One of Those Who Give Too Much?

Consider how you are feeling when you make your purchases or lend money.

Are you buying out of guilt or so that someone will “love you more”? When looking at your debts, are the majority of the purchases made for someone else? Are people always around to take, take, take but never come around to give back? Do you have a queasy feeling when you are making a purchase or co-signing for a loan because you know you can’t afford it, and whether you admit it or not, you know you probably will not be paid back?

3 Steps to Protecting Your Own Financial Well-Being if You’re One of Those Who Give Too Much

Today it’s time to stop all of that foolishness.

1. Recognize that buying out of guilt is a very temporary fix.

If it was a permanent fix, you would have bought something out of guilt and that would have been it. Obviously, it didn’t work because you need to keep buying to assuage your guilt. It’s time to change tactics for a more permanent solution.

2. Consider the person you are buying for.

They may be cute, charming, charismatic or related, but actions speak louder than words.

If they often ask you to buy something for them and promise to pay you back but never do, there’s your sign. If they are obviously financially irresponsible (late payments, creditors calling, repossessions, etc.), there’s your other sign.

Stop helping them dig themselves in deeper. Instead of helping, you are actually turning them into a financial cripple.

Related: Bailing Out Your Adult Kids Financially

3. There’s only three words for co-signing loans, don’t do it.

If a person needs a co-signer for a loan, they either aren’t credit-worthy enough, don’t have enough down payment and/or are living beyond their means. Better to teach them financial responsibility by suggesting alternatives to huge loans that they cannot afford.

Related: Could a Cosigned Student Loan Sink Your Retirement?

A Hidden Benefit of Setting Yourself Financially Straight

Believe it or not, after (often stringent) resistance, setting yourself financially straight will pay off for everyone in the long run, too.

Being debt free and in charge of your life will actually cause others to respect you more. Banishing the guilt and doing what you can and nothing more will cause others to have to stand on their own two (financial) feet. They will also develop more self-esteem and learn financial responsibility, both of which are very good lessons.

Finally, remember that if you can’t take care of yourself, you can’t take care of others. If you spend all of your money on wants for others, you will be unable to help out during a real crisis when your money is most needed.

• Things To Consider Before Helping Adult Children With Housing
• When Your Adult Kid Wants To Borrow Money
• 3 Things To Consider Before Co-Signing for an Auto Loan
• Ways To Help Friends Having Money Troubles

Reviewed August 2023