Family finance: The emotional cost of financially supporting family

With rising costs, increased debt loads, and tighter budgets, many Canadians turn to family for support. Whether it’s helping an adult child get back on their feet, lending money to a sibling, or opening your home to a relative, financial support within families is common across the country. In fact, over half (53%) of Canadians gave money to relatives last year. But money can also strain relationships, create pressure, and sometimes lead to debt on both sides of the conversation.

To better understand how finances and family intersect, we surveyed 1,000 Canadians (excluding Quebec) from across the country. What we found shows that generosity is widespread, but so are the emotional and financial trade-offs that come with it. In the long-term, lending money to family may actually hurt them more than help them.

The cost of keeping up

Rising costs continue to stretch household budgets, from groceries and rent to transportation and utilities. As a result, many Canadians are stepping in to help family members cover the basics. On average, Canadians provided $3,353 in financial support to family.

Some generations are carrying more of that burden. Baby Boomers were the most likely to help family financially, with 61% offering support, and they also gave the highest amounts, averaging $6,027.

Helping family can feel like the right thing to do, especially when you’re more financially stable. This ongoing support can quietly disrupt your own financial plans, particularly if you’re balancing debt, saving for retirement, or managing fixed income. If you’re already feeling stretched, learning what’s considered “normal” debt levels for your life stage can help put things in perspective.

Sharing a home to share the costs

Financial support doesn’t always come in the form of cash—sometimes it means opening your door. Last year, 1 in 10 Canadians moved in with an adult family member.

Multigenerational living can help everyone save money, especially when housing costs remain high across Canada. But sharing a home also means sharing expenses, routine, and responsibilities. Even when no money changes hands, costs like food, utilities, and transportation can add up quickly.

These arrangements can also shift household dynamics. Parents who thought they were done supporting their children financially may find themselves reworking budgets and delaying personal goals. If you’re navigating financial conversations within your household, consider a family finance meeting, which offers a simple way to talk openly about money without tension.

The emotional cost of financial support

Money can be a sensitive topic, even among close family members. Despite that, our survey results suggest financial support doesn’t always damage relationships. Two-thirds of Canadians who either gave or received financial help said it had no impact on their relationship. Only 16% reported a negative effect.

While that’s encouraging, it doesn’t mean emotional strain isn’t present. Financial stress can show up in subtle ways, such as anxiety, guilt, or resentment, especially when expectations aren’t clearly defined. The person offering support may worry about their own finances, while the person receiving help may feel uncomfortable or dependent.

If you’re supporting someone who’s struggling with debt, knowing how to approach the situation matters. Our article on how to help friends or family struggling with debt walks through practical ways to offer support without putting your own financial health at risk.

Doubling up on debt

In some cases, helping family means taking on debt yourself. While only 4% of Canadians co-signed debt for a relative last year, 1 in 10 Canadians took on debt in their own name to help family financially. Among those, 31% took on less than $500, but 26% took on more than $10,000 in debt.

This is where financial support can quickly become overwhelming. Guaranteeing or co-signing a loan is never a low-risk commitment—you're legally agreeing to take responsibility for the debt if the primary borrower can’t make their payments. Alternatives such as credit cards, personal loans, and lines of credit can feel like short-term solutions, but interest adds up fast. Over time, helping family through debt can create long-term challenges for the helper, especially if repayment doesn’t go as planned.

Before taking on debt for someone else, it’s worth understanding how shared or personal debt can affect your future options. If you’re already feeling pressure, learning about formal solutions like consumer proposals or bankruptcy can provide clarity.

Alternatives to financial support

Financial support alone doesn’t build the skills or habits your loved one may need to be financially stable. Giving them money also doesn’t resolve the underlying issues causing their financial challenges and may put your own financial well‑being at risk if you end up giving more than you can comfortably afford. Finding alternative ways to support them can promote long-term stability and empower them to manage their finances more confidently in the future. Consider these alternatives:

• Help them build a budget

• Guide them towards resources (such as our articles)

• Encourage them to speak to a debt professional

When family support isn’t enough

Family support can make a real difference, but it has its limits. Debt can feel incredibly isolating, so having someone to talk to can make a significant emotional difference during a difficult time. When debt grows beyond family help it’s time to seek professional guidance.

Licensed Insolvency Trustees are federally regulated and work with Canadians to explore debt solutions that fit their situation. Whether it’s a consumer proposal, bankruptcy, or simply understanding your options, getting advice early can prevent stress from spilling into family relationships.

If you or someone you love is struggling with debt, reaching out for help doesn’t mean you’ve failed. It means you’re choosing a healthier path forward for yourself and the people you care about. Book a free consultation with one of our debt solutions professionals to get started.