Should You Buy Stuff from People to Help Them Out Financially?

My wife and I have had a couple of situations recently where we have purchased something from someone to help them out financially. The details:

• We have half bathroom downstairs that had 20-year-old wallpaper. We've wanted to have the wallpaper taken down and the walls painted for quite some time now. But since we're thinking of moving, we haven't done anything to it. But we have friends who have had a bit of a rough time financially lately and they own a painting business. We asked them to bid on the job, we thought it was reasonable cost, and we moved ahead with the project (the room looks great, btw!) We didn't get competitive bids or try to negotiate down because the main reason we proceeded was to help them out financially.

• My wife was given a jewelry catalog from a friend recently. My wife is not a jewelry person at all, but she said she wanted to buy something to "help this person out." Not sure if she actually made the purchase or not, but we had a short discussion about giving someone money versus buying something from them to help them out.

What do you think of this concept? On the one hand, buying something from someone who needs financial help does get some money to them in a way that's not a handout. On the other hand, you end up with something you may not want or something you overpay for. Plus, they have costs included in the product/service as well. It would be much more effective (and cost us less) to simply give them some money. But that can be awkward.

What do you think? Does anyone else out there buy stuff from people to help them out financially?

Comments

[Christy]

We had a fence rebuilt between mine and the neighbors house. The price was okay, but the main reason we picked the contractor was he was a recently laid off father of 3 trying to make ends meet. He did a fine job, and the cost was not too bad since we split with the neighbor. It was pretty much a win-win situation for us; maybe we could have saved a few bucks, but it was worth it to help someone out. For him, he just wanted to work and provide for his family, he wasn't asking for a handout. The one "buy stuff to help out" thing I hate is school and scout fundraisers. On those I would rather just give the money than buy the wrapping paper or cookies. I feel the product maker is the one who really benefits.

[Anon]

It's been my experience that doing some kinds of business with friends/family can be an awkward/stupid move.

Case in point, brother in law is not a real estate agent and hasn't sold anything. So the family expects that I would use him to sell my most valuable asset - with the real estate market the way it is currently. What happens when he sucks it up and shows no initiative (as he has demonstrated frequently thus far in his life).

Could you take it upon yourself to fire a family member or friend?

[Anon]

Edit my above post to say "my brother in law is NOW a real estate agent"

[justatron]

I wouldn't use a family contact for something big like selling a house...we have several relatives who are realtors and I won't go to them when we eventually sell. There are too many things that could happen that would create a very bad situation with people we have to see regularly.

However, my wife does have an uncle who has a very successful, 20+ year old concrete business and if we needed that kind of work done, I'd call him in a heartbeat. But I wouldn't just throw work a friend's way if I didn't think it would be done properly or done well.

[Money Beagle]

If you're planning on buying something / getting it done anyways, I see no problem with giving family or friends first dibs (or only dibs) at the work. However, I wouldn't buy something or get something done that isn't needed.

[Bad_Brad]

This is one of my pet peeves about some of my wife's friends. They'll start selling Avon or Tastefully Simple or something similar and offer to throw a "party" at our house. My wife, ever the accomodater and ever wanting to have social interaction, hosts the party. She pretty much feels like she is REQUIRED to spend upwards of $50 on something we don't really need, just to help her friend out.

Drives me NUTS!

[Personal Finance]

I also have a family member as a Real Estate agent, although i have not needed her, another family member did in the past and things went wrong and although nobody's fault this caused a chaos in the family. I personally wouldnt mind buying something from a friend or relative to help out financially, but it would depend on the situation.

[Kyle]

I think this is a great way to help someone out in financial trouble but allowing them to keep their sense of pride. Mind you buying Avon from someone isn't going to help them too much financially, but getting your car detailed for $150 in cash is going to boost your friends bank account and keep their pride intact.

[BigBoy]

I have recently hired a friend of my neighbors who was recently laid off from a construction job to do some handy man jobs around the house. His work is very good and his pricing is reasonable, he told me that he appreciated the work as it keeps his mind active and gives him some money. I told him i could have a project a month for him if he was interested. I have no problem with this since I need work done and have the cash to pay him.

[DebtGoal]

In general, you should not buy stuff from other people in order to help them out financially. A good exception to this rule is the coincidental case in which the item being offloaded is of particular need. But the real problem remains that if something of it breaks or otherwise does not meet expectations, then the potential to ruin a relationship exists, no matter how well-intentioned either party is. Figure out ways to help friends that does not involve direct financial intervention.

[Wise Money Matters]

I think it's a case by case determination. If my family was in trouble financially and they were doing what they could to make it, I'd help them out. If it were some distant friend whom I heard was laid off, I probably wouldn't.

Such an answer is an emotional answer which is highly subjective rather than a simple logical answer which isn't. It depends on your personality, the closeness of the person, and your own financial state.

I think such acts of kindness are more needed these days, however you shouldn't put yourself in financial danger for such a cause. That's the most objective answer I can give.

[George]

It seems like a couple questions....I like to help someone out who needs work and I need something done...I will pay them to help out. But it gets kind of hard when you know them to then ask for a discount because you think the price is too high. However, I hate it when my wife gets invited to parties like purse/jewelry/avon, etc. The "friends" try to intimidate you into buying something not needed and overpriced so that they can get something free. My wife is very good at saying "No". These people don't need the money. I also don't like buying useless wrapping paper, overpriced magazines from the neighbors kids for fundraisers when I also have the same thing. I suck it up and give a donation to my kids org, but don't want to buy more crap.

[Param]

Your uncle, cousin, nephew, friend, neighbor, et al has started selling life insurance & he wants you to buy an overpriced policy so that he can establish his foothold with the company, ensure commission for his livelihood and also get a shot at some contest to go to Hawaii. Should/Would you buy "something" from him to help him out???
I think the way you would handle this should apply to any other product/service you but from people you would like to help.

[Kelly]

I think it is a case by case thing.
First of all you want to make sure the work/product is worth the money, and secondly you want to spend the money on something only if you can afford it.

I too will forgo the selling stuff fundraisers at school in favor of helping in the classroom when I can, donating materials the teacher asks for, and giving the teachers holiday and end-of-year gifts.

As far as those parties go, there is never an obligation to buy, and many women do these small businesses because they do need the extra money. While most people only make enough to cover the cost of what they want to buy and their supplies, when you put a lot of effort into your business it can pay off. My mom spent years as an Avon representative earning enough to pay for things like ballet class, swimming lessons, clothing for us, etc. Eventually it turned into a job, and she managed a group of representatives. A handful of them were making between $50-100K/year! It's all a matter of what you put into it, and how much you care about the products you are selling.

[Kate]

I've generally regretted when I've made a financial decision to help someone out: became someone's downline in Amway to help her, bought life insurance from a friend new to the business when I was a new college graduate with no spouse or children and no need for life insurance, hosted home parties for things like Pampered Chef to help out. I also have friends who contracted home repairs with a friend who ended up using up all the money they budgeted for home remodeling without finishing the job. I wouldn't completely rule out doing business with a friend if I really wanted/needed something, but I'd go about it very carefully, making sure that the friend could deliver without doing damage to our friendship.

[SmartSecurityPeople.com]

An example of this on a small scale is when we have a local neighbor kid,niece,nephew,cousin,etc approach us about buying a magazine subscription, cookie dough, candles, household nick knack to help fund their organization or church trip. We will typically purchase something but more times than not, we will just give the person money to help with their cause. Usually, what we give them ends up being more than the commission they make off of the sale.

[Crystal Groves]

I will hire people in trouble to do a job because I know they'll do it right so they can get more business. I don't really like hiring family members because some of my family members have cheated each other out on those types of things. But if I know I can trust someone, then I'll hire them. I think it's important to help the mom and pop people rather than big companies.

[Jon]

I've done both recently. My wife hosted a Southern Living party for a young lady who's recently divorced and trying to make some extra money. Since I've helped her out by flat out giving her cash before, the amount my wife spent at the party is negligible.
I also had another friend, an out of work contractor, come and install some tile in my master bath as part of my remodel project this winter. He did an excellent job, made a little money to supplement his UI check, and everyone was happy.
In the past, I've used a friend who's a plumber, a couple of different friends in the heating and cooling business, a neighbor who's a general contractor, real estate agent friends, car salesmen friends...
There's nothing wrong with doing business with people you know, it helps make the economy go round.

[Mike Hunt]

You know, paying people for a service to help them out financially is often the mindset of local men who pay women for company and sex. At least that is the case here in Thailand.

My point here is just follow your heart and be generous. Should work out in the long run.

-Mike

[Colleen]

I wish someone would give me work to help me out, I can,t even get that. I am disabled fighting with social security for 6 years to get my SSA and am in need. I do light house cleaning to supplement my very small income, and with ad after ad I can,t even get that. I am behind on all my bills and about to become homeless and no matter how hard I try to help my self with out a hand out it never works out. I am at the point now I will take either. I am about ready to be one of those people on the street who holds up a sign. That said help others how ever you can to prevent more people from being on the street. Sometimes we need to swallow our pride and ask even strangers for help, and those who help do not worry about their pride the help is apperciated either way.