Parting with money: When is it okay to be selfish with your hard-earned cash?

Amid rising inflation, interest rates and recession fears, silver is tightening.

Still, there may be charities you want to support, friends or family asking for financial help, and things you want to buy for yourself.

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It is possible to do these things, even on a limited budget.

But if you want to be responsible with your money, you need to know where to draw the line.

When is it okay to put your own interests first?

When your finances are at risk

Think twice before spending any amount of money on someone else, whether it’s $20 or $2,000.

Will it compromise your ability to pay bills or save for emergencies?

Will giving money hurt your own business? Stock image. Credit: Phiromya Intawongpan/Getty Images

Grabbing a friend’s lunch or helping your child get to college shouldn’t come at the expense of your own expenses and goals.

A crucial part of this assessment: assume you will never get the money back.

There is no guarantee that your loved ones will pay you back, no matter how well intentioned.

“If you can’t afford to give it as a gift without any expectation on your part, then you can’t afford to help out,” says Lacy Rogers, Certified Financial Planner in Fort Worth, Texas.

Saving toward a “donation budget” in a designated account can create a clear separation of your expenses, says Chicago-based CFP Valerie Rivera.

If you don’t have enough funds in the account, it means you can’t save the money.

You feel compelled to pay

You don’t have to give money, even if you can afford to be generous.

It’s okay to say no when you’re feeling stressed or uncomfortable – don’t let others talk to you about something you’ll regret.

Saying no can be difficult, especially when it comes to a close-knit family or community.

Your mom raised you, so the least you can do is pay off her credit card debt, right? Not if it allows him to spend repeatedly and turn to you for money.

You have the right to say no. Stock image. Credit: krisanapong detraphiphat/Getty Images

Having conversations about finances with loved ones — early and often — helps set expectations.

“It’s totally okay to re-establish or establish for the first time what money looks like in a discussion with friends, a discussion with family,” says Kate Mielitz, Certified Financial Advisor in Tumwater, Washington.

Take the time to process every request for money that comes your way.

Consider switching if you fear being taken advantage of or supporting harmful financial behavior.

You can help in other ways

Supporting the people you care about doesn’t always have to cost money – your time, skills and knowledge are valuable too.

Suppose you have an elderly neighbor whom you were grocery shopping for.

“Maybe you can’t buy groceries for them anymore, but you can help them with yard work, and maybe that takes the load off them in a different way,” Rogers says.

Money is tightening. Stock image. Credit: firecrackers/Getty Images/iStockphoto

If you can’t get personally involved, refer your loved ones to those who can.

“Help your friends and family learn about the resources of the area…to help them move forward and grow stronger,” says Kate Mielitz.

She suggests these resources could include a community food bank, a second-hand clothing store, or support services for employment-related issues, such as resume writing.

Put some money aside to treat yourself

Caring for your needs and goals – and giving to others – is important. But everyone also deserves a little fun.

“We are human and we need balance. We can’t just save for later and not enjoy life today,” says Rivera.

If you have discretionary money, don’t spend it entirely on others – leave room for personal care, entertainment, or whatever brings you joy.

“Often we use money to find ways to improve our mood. Whether it’s dining out, going out for a drink with a friend, or buying a book,” says Mielitz.

“But you need to make a spending plan and know what you have access to, because there are times when we don’t have the money and we spend it anyway.”

Regularly setting aside funds or redistributing expenses can give you the flexibility to splurge without hurting your finances.

“Life in general is a series of compromises,” Rivera says.

“So it’s about choosing – what’s really going to add value to your life?”

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