I’ve found that when you’re a financially stable person and in control of your finances, you can find yourself in sticky situations with friends. Why? Because the ones that don’t have their finances in check come knocking. I used to be proud to tell my friends how well things were going with work and my career. Now, I just tend to keep it to myself… and the few people reading this. Should you lend money to friends? Well, let’s see…
I can actually count the number of times that I’ve lent money to friends. Hint: It’s less than the fingers on my left hand. Do I regret lending those friends money? No, because it only took a handful of times to realize never to do it again. What’s so wrong with helping a friend in need? Nothing at all, but pay close attention to what they’re asking.
Here’s why I don’t let friends borrow money:
- Friend scenario #1 – Bought a set of season tickets for the baseball season with a friend. I wanted to make sure he was good for it and had asked several times since it wasn’t cheap. I put the money upfront and he said he could pay me back in the next two months. I never saw the money again. It was really uncomfortable seeing him after that and our friendship was never the same. I don’t recommend putting yourself in that type of situation if you can avoid it.
- Friend scenario #2 – Lent a friend in need $200. At the time, as a college student, I couldn’t afford just to give money away. He really sounded desperate and I decided to help him out. Even though we agreed on a payback date, he found time before then to go out and spend money at the bars. How bad did he really need that money?… I confronted him about it and we resolved the situation.
- Friend scenario #3 – A friend called me while I was working and was utterly desperate. He had told me his family wouldn’t lend him money and he had nowhere else to turn. This was more recently, so I had already made a line of stone and had no plans to cross it. I told him I couldn’t do it and didn’t hear from him for quite a while after that. After I had insisted that I couldn’t lend the money he began to tell me about recent purchases he made. It was as if he made no connection to asking me for money and the spending spree he went on.
Should You Lend Money To Friends?
At the end of the day it’s your call, but it wouldn’t be my first recommendation. I would try to find alternatives to the situation. Only you can determine if someone really needs your help. Just tread lightly when someone comes knocking.
I’ve had a handful of other cases that have happened, but it’s surprising how people will abuse someone who they think has more money than them. I can’t really understand this mindset, but it’s almost as if they think, “He can afford it.”
I’m not rich by any means. Money doesn’t just grow on trees in my life. I’ve worked hard and I’ve saved my money. Have I spent recklessly? Sure, I’ve turned from a gambler to a saver, but I had the money to do so!
I no longer lend out a helping hand. In fact, if I borrow $10 I’m the first one to go instantly to the ATM and pay the person back. As far as finances go, I live by the golden rule.
I’m Not The Only One
The truth is, I’ve heard plenty of similar stories in the past. Someone wins the lottery and they end up disconnecting their phone line. Family members come out of the woodwork asking for money.
There are other articles out there about reasons why you shouldn’t lend money to friends.
I remember watching Mark Cuban discussing a friendship he had that ended over money. Ever hear the news about Kevin Hart and his extortion tape? Well, that turned out to be a close friend of his. The things people will do for $$$…
Have you ever had issues with friends and money?