You’d do anything for your friends. But when that extends to finances, things can get fishy. If you have a friend in need, should you be a friend who lends? Here are some things to think about.
1. How much are we talking? If your friend is in deep financial trouble, and you think you have the means to help her, consider if helping out could potentially put you at financial risk. It’s like being on an airplane — make sure you have on your oxygen mask before you help put hers on.
2. Consider what happens if you never get it back. Even if your friend fervently promises to repay you, it’s important to consider what happens if she doesn’t. Are you mad? Could you foresee your anger becoming so significant it ends the friendship? If you answered yes, then don’t lend. If you’re okay even if she doesn’t pay you back, then you may be able to go forward.
3. Ask yourself if you’re enabling. Anyone can find themselves in a sudden unexpected financial difficulty. If your friend has an extenuating circumstance, and you can afford to help, you may be able to safely make a loan. However, if your friend finds herself in a pickle quite a bit, lending her money won’t solve her problems — and it may mean she’ll be coming back to you for another loan in the future. The moral of this story: Enabling friends bad, helping friends good.
xx, The FabFitFun Team