NEW YORK (CNN/Money) - There are times in life where it seems like your only options are to feel bad, angry or awkward.

No, I'm not talking about unrequited love. I'm talking about unrequited loans -- specifically, those to a sibling.

Say your brother is having a hard time meeting a financial obligation and comes to you for help. And say by objective financial measures you're better off than he is. That doesn't necessarily mean you should agree to advance him the money, even if he promises to pay you back with interest.

It's not always a bad idea to lend money to a sibling. But for everyone's sake you should do so only if:

You really can afford to. Putting some of your vacation money at risk to help out is one thing. Don't compromise your key financial goals, however, such as your retirement savings, your children's education funds or your emergency fund, said Jon Duncan, director of wealth management at RSM McGladrey in Tacoma, Wash.

You're not feeding a bad habit. Make sure your money won't be used to help your brother secure his position as the world's best addict or spendthrift.

Money emergencies can happen to anyone and no one's immune from making a costly mistake. But, said certified financial planner Mari Adam, "people with bad money habits always have financial emergencies."

You're willing to make like Buddha and give selflessly. Ask financial planners if it's a good idea to lend money to family and their typical response, often accompanied by a weary chuckle indicating they've seen plenty of pile-ups on this highway, is "No, don't do it." If pressed, sometimes they'll soften and say, "Well, I guess it's all right...so long as you make it a gift."

In other words, make the loan if you want to, but don't expect to be paid back, said Jon Duncan, director of wealth management at RSM McGladrey in Tacoma, WA. "If you're so concerned with getting paid back, you shouldn't make the loan in the first place."

You're willing to play banker. Just because you accept that you may never be paid back doesn't mean you shouldn't set things up like a formal loan.

"To not hold your sibling accountable is not doing them a favor," Duncan said.

When you're lending "real money" (a subjective amount, to be sure), planners recommend you draw up a loan agreement complete with interest, terms of repayment and provisions for how the matter will be settled if your sibling defaults.

Indeed, said certified financial planner Mark Groesbeck, "to the degree that both parties understand what is expected of them, there is less chance of hurt feelings or disagreements."

Your better half pre-approves the loan. Funneling money to your sibling may be big of you but it may not go over so big with your spouse, especially if he or she thinks there are plenty of other things in your life together that need funding. So unless you're fixing for a fight or worse, consult with your partner first, Adam said.

Your personal relationship can survive any business problems. Money alone can cause tension between two people, Duncan said. Throw in a little sibling rivalry or old emotional baggage and you've got yourself a combustible mix.

Since you're considering combining a familial relationship with a business one, consider what problems might arise if the loan is made, and ask yourself, "Can I settle one (relationship) without damaging the other?" Adam said.

Whether you say yes or no to the loan request, give a respectful, firm and diplomatic response, if possible.

You'd also do well to keep your emotions out of it and state your reasons as briefly as possible, said Peter Post, coauthor of "The Etiquette Advantage in Business."

If your answer is "No," you might say, "I appreciate that you came to me, but I really can't do this right now," Post suggested. Or, "I really don't think loans between family members are a good idea. And I wouldn't want to jeopardize our relationship."

You also might follow up with suggestions about how else your brother or sister could obtain the money, such as a home equity line of credit or borrowing against a life insurance policy. Coming to you may have seemed the path of least resistance to your siblings, and therefore the first stop, Adam said, but other possibilities may not have occurred to them.

If your answer is, "Yes," be clear about your terms. You might say, "I'd like to help, but in order to make it work for all of us, let's set it up the way a loan ought to be done," Post suggested.

Before rushing to change the subject to a more comfortable topic, you might add, "The one thing I don't want to happen is have this loan become a problem between us."

Jeanne Sahadi writes about personal finance for CNN/Money. She also appears regularly on CNNfn's "Your Money," which airs weeknights at 5 p.m. For comments on this column or suggestions for future ones, please e-mail her at everydaymoney@cnnmoney.com.