Don’t Lend Money That You Can’t Afford to Give Away
- Allowing family or friends to borrow money can put your relationship at risk should something go wrong.
- People will often give you a sob story to borrow funds but will have a different attitude if or when you have to ask for your money back.
- You must think about your financial position before trying to help someone else.
In Drake's song titled "All Me," he raps, "I've been taught to never loan somebody what you need right back."
Regardless if you are making $8.00 per hour or $80,000 a year, people still find themselves living paycheck-to-paycheck. That can be due to not making enough money to meet life's basic demands, poor money management, or both. However, another reason may be our inability to say no to family members and friends who come to us to borrow money.
You can't lend away what you don't have, and you shouldn't let anyone borrow money that you can afford to give away.
Money can ruin relationships.
Lending out cash could strain the relationship with the person you let borrow the money. While you may fall weak to the sob story told to you to get the funds, that same person can turn vicious when you ask for your money back. So yes, that means your best friend may catch an attitude with you when you call for your money back, almost as if you owe your friend money versus the other way around.
Lending money can put you in a financial strain.
Your needs could be put on hold due to not getting your money back. For example, let's say that you let a friend borrow $100, and they told you that they would pay you back no later than the end of the month. If they do not stick to their word, that may mean you fall short of the funds needed to pay your bills due in the upcoming month. As a result, it could lead to late fees on your bills, having to borrow money from someone else, or having to get a high-interest payday loan.
Recommended Read: What Is a Payday Loan?
Only lend money you can afford to give away.
Never let someone borrow money unless you can afford to give that amount away.
The best way to position yourself to help someone financially is to build a strong financial foundation and savings for yourself. There is nothing wrong with financially helping someone else, but only if you can afford it. If you can't, say no.