Ah, the age old question: whether to insert real people and events into your writing or not. It’s one of the many quandaries in writing that can either go really, really well or really, really badly. Your Great-Aunt Imogen may be thrilled to have been given the role of domineering countess in your novel or she may stop sending you hand-knitted sweaters forever. Your best friend may be highly amused that you included that crazy night at the book signing in your memoir or he might just delete every Facebook photo of the two of you. It’s all very subjective and touchy and confusing. But here’s all I know about it.
Mine is completely and totally insane, and some of them would probably wear it like a badge of honor if I wrote about them in all their lunatic glory. Yours, however, may be a bit more sedate and a lot more likely to be offended at having their personal lives published, particularly the more embarrassing bits. This is perfectly understandable, and you should respect their privacy if they want to keep certain things to themselves. Resist the urge to secretly slip the coveted piece of information in anyway and just never let them get a hold of a copy of the book. They’re your friends and family, after all. And, really, is it worth the risk of setting off (and hurting) Aunt Gladys?
2. What’s their story like?
Ok, supposing your family doesn’t mind being fictionalized. Are they actually worth fictionalizing? What’s fascinating to you as a child or grandchild or whatever may be dull as a #2 pencil to the rest of the world. No matter how hard Cousin Hubert begs for you to include a paragraph about his stamp-collecting, please be considerate of your readers. And Hubert, too, when you tell him no.
On the other hand, you may have good stories. But some family legends–true, though they may be–just aren’t relevant to your story. My father demolished a liquor store the first time he got behind the wheel of a car. That’s true. That’s entertaining. But it isn’t relevant to my Victorian adventure novel and I can’t shoehorn it, regardless of how good it is.
3. Can you unobtrusively put them in?
Even if the family member is the shy sort (or if you don’t really want to ask), can you scrub their identity to the point that they wouldn’t even recognize themselves? Can you alter a story to put off anyone who might know it without losing its essence? Typically, yes. It is possible. Swapping genders or ages for characters, substituting major characteristics that change the character, but don’t change the things you need for your story, and changing enough little details in an event can all make a huge difference in the way your tale comes across.