Lending money to family can get tricky Ap Images: Reed Saxon
Mitch Pomerantz, president of the American Council of the Blind, holds U.S. currency he can't tell apart, in his Los Angeles office Tuesday, May 20, 2008. Since all U.S. paper money feels pretty much the same, the government is denying blind people meaningful access to the currency, the U.S. Court of Appeals for the District of Columbia Circuit ruled Tuesday. The decision could force the Treasury Department to make bills of different sizes or print them with raised markings or other distinguishing features. The American Council of the Blind sued for such changes, but the government has been fighting the case for about six years. (AP Photo/Reed Saxon)

Lending family members money can get messy if you don’t take precautions before hand. Here are six tips to consider before you dish out the dough to your family:

  1. Understand that the relationship will change. When family is involved, so are emotions.
  2. Consider making it a gift instead of a loan. Giving the money as a gift will insure that there are no expectations for the receiving party.
  3. Say no respectfully. You don’t have to say yes just because they’re family, but you should do your best to be respectful.
  4. Decide what the interest rate will be and make sure that is made clear to the individual who is expected to pay it.
  5. Get the loan in writing. There will be no confusion later if you write out the details now.
  6. Consider the fact that you may not get your money back. The biggest risk of lending money to family members is that you may never see that money again.

RELATED: How to make sure someone doesn’t steal your tax refund

Before you risk your relationship with your family members, do your research and take all the options into consideration.

Kaitlyn Winey About the author:
Kaitlyn Winey is an associate videographer/editor for Rare. Follow her on Twitter @TheWineyWrapUp.
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