Financial Etiquette in the New Economy

For many people, 2009 was a bumpy ride. Although the economy seems to be rebounding, times are still tough for those dealing with significant financial issues such as unemployment, lack of health insurance or home foreclosure.

We all want to offer emotional support to our friends during financially troubling times, but knowing which approach is best isn't always easy. Some people appreciate helpful advice and being checked in on frequently, while others would prefer to be left alone to solve their problems privately -- or they don't know how to ask for help.

Here are a few common-sense approaches, no matter which side of the equation you're on:

Banish survivor guilt. Just because a family member, friend or co-worker lost their job doesn't mean you can never discuss yours. Work is part of life and a natural topic of conversation, so purposely avoiding it will not go unnoticed and may create awkwardness between you. Just be careful not to let work issues dominate your conversations and watch for signs that the topic may have run its course.

Vent with caution. It's natural for laid-off former co-workers to want to unload about their former employers. Be a good listener, be discreet, but be careful about chiming in yourself. And, if you're the one venting, be careful not to make your former colleagues uncomfortable. Plus, you never know who's sitting at the next table.

On a related note: Never put anything critical about your employer -- or anyone, for that matter -- in writing, in an email or on a social networking site: You never know when your words might come back to haunt you.

Join the job hunt. If you're unemployed, feel free to network with friends, family and former colleagues. Just don't rely too heavily on their help; you have to lead the charge. Likewise, if it's your friend who's looking, gauge whether he or she is interested in hearing about job leads and know when to back off. Even if you don't have any good leads, you might be able to help revise their resume, practice interviewing skills or even just provide a friendly diversion from their search.

Broaden your social activities. This doesn't mean you should stop shopping trips or dining out with a newly unemployed friend if that's what you always do together. But try to come up with other, less costly suggestions and let your friend choose. For example, seek out more affordable restaurants, go to a museum's free day or just take a walk together. If you want to pick up the tab, make the offer upfront to avoid any uncertainty, and be gracious whether your invitation is accepted or declined.

Borrowing -- or loaning -- money. This is a particularly touchy subject, no matter which side you're on. It's hard to turn away a friend in need, but many people can't afford to put their own finances at risk over a personal loan -- not to mention the potential for hard feelings if someone defaults. Here are a few suggestions:

• Seek free or low-cost credit counseling from a certified consumer credit counselor. The National Foundation for Credit Counseling and the Association of Independent Consumer Credit Counseling Agencies are two good places to start your search.
• If you're the one being asked to loan money, don't feel obligated to answer right away. Consider whether you can really afford it and whether the loan will truly address the problem or merely postpone a painful inevitability, such as foreclosure or bankruptcy.
• Try borrowing from a bank or credit union first.
• If that doesn't work, third-party services like Virgin Money provide guidelines and formal loan structure -- for a fee -- for loans between acquaintances.
• Other peer-to-peer lending services such as Prosper and Lending Club connect potential borrowers with investors willing to lend money.
• Note: Not all peer-to-peer lending services are available in every state, and you should make sure the company is registered with the Securities and Exchange Commission.

This article is intended to provide general information and should not be considered tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how tax laws apply to you and about your individual financial situation.

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