Lending people money

MorpheusMorpheus
in General

I had a friend ask me for a loan recently. It bothered me because this friend hardly ever reaches out to me. Also, she recently spent large amounts of money on a couple of things which I felt was very irresponsible. I never really said no but I definitely never lent her any money. What is your criteria for lending money. What kind of experiences have you had, good or bad?

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Comments

  • Carrie_AnneCarrie_Anne

    Don’t they say that if you feel compelled, give it as a gift with no expectation of it being paid back, so not actually a loan. There’s an expression for that but I can’t remember it.
    Still, it’s at your own discretion, I wouldn’t feel obligated. “No, I can’t “

  • MTexMTex
    edited August 2025

    A long time ago I was the one that borrowed money. It was for a trip that my friend and I were both going on. She put it on her credit card with zero interest and I just paid her back every month. I did write up a Payback contract and every time I paid her we would write it on there. Initials for the date that I paid & the amount. That's the only time I did that.

    Generally speaking I don't think it's a good idea to lend money to friends unless you're willing to make up a contract and even then it might be a gamble.

  • BearBear

    I have more bad experiences. Yet this quote hit me in a different way when I heard.

    AI Overview

    In the movie "A Bronx Tale," the quote about borrowing money is: "If you lend someone $20 and never see that person again, it was probably worth it." This quote, often attributed to Sonny in the film, highlights a perspective where getting rid of an undesirable person is worth the monetary loss.

    Since you will probably never see them again. Back in the 60s when $20 meant more.

  • JubalJubal

    The polite approach: "I dont feel comfortable making personal loans, sorry"

    The blunt approach: "me and the bank have a deal. I dont loan money and they dont sell comic books"

  • Rocket_ManRocket_Man
    edited August 2025

    I don't lend money to people. If it is someone I trust to use it wisely and who I know really needs it and has been a good friend to me ,and i know is thankful then I just give it to them as a gift. It's usually when I know they haven't asked. I just saw the need.

    I certainly don't always do it but when I can. By just giving it as a gift there is no drama about getting paid back and I help out a friend . I don't really do it for strangers or acquaintances.

  • TheFunCartelTheFunCartel

    I stopped lending money because keeping leg breakers on the payroll cost too much.

  • TheDave90TheDave90

    Only if it's for immediate family since I know they're trustworthy.

  • waynewvwaynewv

    I have found it’s the best way to lose a friend.
    I have had to say no many times, it seems as an owner of your own business everyone thinks your rich.
    I have had friends and family asked me for start up funds for some kind of a business venture and to go in as a partner. My excuse is all my money is tied up in long term investments.

  • [Deleted User]gem7 (deleted user)

    I once loaned money to a friend. He said he would pay me back the next time he saw me.

  • AuroradreamAuroradream
    edited August 2025

    comment removed. - Stormy

  • [Deleted User]WriterGF (deleted user)

    I have no money to lend, so it doesn't come up.

  • Erin_Elle_Erin_Elle_

    I can’t recall anyone ever asking me for a loan.

  • [Deleted User]gem7 (deleted user)
    edited August 2025

    @Erin_Elle_ Can I borrow some money from you? B)

  • _marC_marC

    💯I agree with @g_w_t_w ! If you can afford to help a friend yes help them- however just give them the money as a gift not as a loan. This will circumvent any future bill collection/enforcement

  • MonkeyNeedsAHugMonkeyNeedsAHug
    edited August 2025

    Not surprised by this, but I seem to be in the minority here. My take is that if I can’t trust you with my money, then we aren’t likely to be friends. Why would I trust you with my time, my emotional energy, my hopes and dreams (things that are far more valuable to me) if I can’t trust you with money?

    Additionally, it’s a core value of mine to invest in a manner that’s consistent with my beliefs. My friends are less likely than the stock market, for example, to try to profit off of war or take advantage of the vulnerable. As far as my nest egg is concerned, it’s heavily invested in my friends.

    Wish us luck.

    🤞🏽

    🙈

  • ladybug7ladybug7

    My personal beliefs on loaning money is never ever give someone something you can't afford to lose or give away as a gift. That way if they pay you back awesome, if they don't oh well but you aren't down a friend. If you are already going through a list of criteria in your mind about this person... You aren't the money lending kind of person/they arent the one to move you to lend..
    . I love the Bronx tale thing... That movie has a lot of hidden life gems. I have given a lot of money away over the years when people asked for help IF I had it spare. There is one person in my life I will give to if I don't have it to spare, because they have always paid me back. I made my mind up if they don't though... That's my bad for not following my own rules.

  • CuddleDuncanCuddleDuncan Mod

    Very limited experience, but always good. And always with people I was close to, not somebody who rings up out of the blue.

    If the amount is small, make it a gift and forget it.

    If it is moderate, make the repayment terms vague and assume you will never see the money again. If it's a decent person, or a true friend, you will and that will be a lovely bonus.

    If it's a large amount, sit down with them at the kitchen table and write a paper. Amounts, dates, repayment schedule, interest rate, how they are going to repay it, what happens if they miss a payment, etc. Everything a bank would do. Write it up neatly, and you both sign it. The lender gets the original, the borrower gets a photocopy. Always keep discussions about the loan seperate from all other activities and communciation: don't do it at the birthday barbeque. You phone or meet specifically to discuss the loan, and yes after you've done that you can have a catch up or a pint if you want.

    Decide beforehand whether non-repayment in whole or in part ends the friendship. You may or may not wish to communicate this information to the borrower. Also decide other circumstancial matters: for example are your mutual friends to know about this, or is it confidential. A suitable interest rate, if you choose to charge interest, is often between the bank deposit rate and a typical bank loan rate, so that you share the benefit.

    You may wish to consider whether the money is for a capital project (e.g. house) or expenditure (e.g. holiday). However the details are up to the borrower: it's their money. What is frivolous to you may be essential to them.

  • SoosonSooson

    I favor this approach when applicable.

  • HollydollhugsHollydollhugs

    I’ve given my time especially to family and friends that may need help with something, No money exchanges hands. It seems to be way more valuable to them.

  • MonkeyNeedsAHugMonkeyNeedsAHug
    edited August 2025

    Another argument in favor of loaning to friends…

    Banks make a profit, in part, by holding my money and paying me interest (say, 6%) and loaning that money to someone else with a higher interest rate (say, 10%). I have found it good business and mutually beneficial to cut the banks out of this equation, much of the time.

    💸

    Editing to add that those interests rates are examples.

  • mistic233mistic233

    Nope nope and nope! there's isn't a faster way of loosing a friendship than by getting money involved , unless it's my mother or my father I'm not doing it

  • KloverNKuddlesKloverNKuddles

    It depends on who it is and what it is for, but I never have expectations of getting the money back. It’s always a gift. That way there is no energetic tie.

  • BearCraftBearCraft

    My folks once told me, "Never loan money that you expect to get paid back." Money can easily tear apart friendships, especially if they don't or "cant" pay you back. I put quotes around cant because often times they will come up with excuses as to why they are unable to pay you back. Sometime these reason can be legit but often times, they just don't want to.

  • [Deleted User]LadyLapCat (deleted user)

    As others have said, if I’m in a position to help, I do so without expectation of payback. I don’t want to let something like money get in the way of my relationships.

  • Ironman294Ironman294

    Always lend money to people you never wanna hear again. They will ghost you

  • DarlingNikkiiDarlingNikkii

    More people should loan money out to their friends or family if they can. When I first moved to seattle, with a w-2 job, I couldn’t afford rent+last month+ deposit. My second cousin lent me the money to pay off in a year, no interest. I paid it off in 8 months, and I didn’t have to pay a giant company any extra money. He’s retired - and had the funds, he knows it’s hard out here. I have covered my friends until their next paycheck if I had the extra funds.

    I would never loan money tho to an addict, or someone who has had a car repoed - or other major issue, unless I knew I was throwing it away.

  • CuddlesWithCatCuddlesWithCat

    I’m trying to buy a fursuit and asked this guy if he could help me out, we’re discussing this Tuesday how much he can help me out. I’m super grateful. I offered to pay back but he doesn’t want me to, wants to see me happy and considers it as a gift to me. I am honestly moved by this, if he’s willing to go this far for me… I guess we’d consider Tuesday a sushi date. I’m not after his money though…

  • 1984joe1984joe

    Someone today asked me for $3000 lol. A couple of days ago I told him that I have what I want saved up for my trip to Albania in October. I ended up telling him that my "savings " is in the stock market. Not lendable, told him that if he sells my bus i can lend that.

  • SoosonSooson

    Back in the office days, before becoming full time WFH , people at work allways hit me up for money. I will just say I was not an equal opportunity lender.

  • MorpheusMorpheus

    Thanks for everyone’s comments. To clarify a few things, when I have (lent) money to people in the past, I always do it with the expectation that I’m giving it to them. I never expect they’re going to pay me back. Maybe that’s irresponsible on my part and I’m enabling them but at least it won’t lead to disappointment.

    I like what @Hollydollhugs said about giving her time. I agree with that completely. I will give people my time, my love, my attention and I will feed them if they’re hungry. Money is a different story though.

    I respectfully disagree with @MonkeyNeedsAHug I can definitely not trust someone with my money or other aspects of my life and still be they’re friend. For example, I trust very few people with my dogs including several friends. I’m not saying they would hurt my dogs but different people have different levels of responsibility.

    Great comments everyone, I appreciate it.

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