{"id":5899,"date":"2025-02-02T16:12:37","date_gmt":"2025-02-02T14:12:37","guid":{"rendered":"https:\/\/moneyhub.ee\/?p=5899"},"modified":"2025-04-22T13:39:11","modified_gmt":"2025-04-22T11:39:11","slug":"reasons-not-to-lend-money-friends-family","status":"publish","type":"post","link":"https:\/\/moneyhub.ee\/en\/useful\/articles\/reasons-not-to-lend-money-friends-family\/","title":{"rendered":"8 reasons why you should NOT lend money to friends &#038; family"},"content":{"rendered":"\t\t<div data-elementor-type=\"wp-post\" data-elementor-id=\"5899\" class=\"elementor elementor-5899\" data-elementor-post-type=\"post\">\n\t\t\t\t<div class=\"elementor-element elementor-element-77c96ecc e-flex e-con-boxed e-con e-parent\" data-id=\"77c96ecc\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t\t\t<div class=\"elementor-element elementor-element-51302053 elementor-widget elementor-widget-shortcode\" data-id=\"51302053\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"shortcode.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t<div class=\"elementor-shortcode\"><nav aria-label=\"breadcrumbs\" class=\"rank-math-breadcrumb\"><p><\/p><\/nav><\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-63f17727 e-flex e-con-boxed e-con e-parent\" data-id=\"63f17727\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t<div class=\"elementor-element elementor-element-4ee64a67 ddddf e-flex e-con-boxed e-con e-child\" data-id=\"4ee64a67\" data-element_type=\"container\" data-e-type=\"container\" data-settings=\"{&quot;background_background&quot;:&quot;classic&quot;}\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t\t\t<div class=\"elementor-element elementor-element-37775c8d elementor-widget elementor-widget-heading\" data-id=\"37775c8d\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">8 reasons why you should NOT lend money to friends &amp; family<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-7bd851bb e-flex e-con-boxed e-con e-parent\" data-id=\"7bd851bb\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t\t\t<div class=\"elementor-element elementor-element-3493791 elementor-widget elementor-widget-image\" data-id=\"3493791\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"image.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<img fetchpriority=\"high\" decoding=\"async\" width=\"2560\" height=\"1364\" src=\"https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-scaled.jpg\" class=\"attachment-full size-full wp-image-17726\" alt=\"don&#039;t lend money to friends &amp; family\" srcset=\"https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-scaled.jpg 2560w, https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-300x160.jpg 300w, https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-1024x546.jpg 1024w, https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-768x409.jpg 768w, https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-1536x819.jpg 1536w, https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-2048x1092.jpg 2048w\" sizes=\"(max-width: 2560px) 100vw, 2560px\" \/>\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t<div class=\"elementor-element elementor-element-6a1d267c e-flex e-con-boxed e-con e-parent\" data-id=\"6a1d267c\" data-element_type=\"container\" data-e-type=\"container\">\n\t\t\t\t\t<div class=\"e-con-inner\">\n\t\t\t\t<div class=\"elementor-element elementor-element-2f89c673 elementor-widget elementor-widget-heading\" data-id=\"2f89c673\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"heading.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t<h2 class=\"elementor-heading-title elementor-size-default\">8 reasons why you should NOT lend money to friends &amp; family<\/h2>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<div class=\"elementor-element elementor-element-69b8eb6d elementor-widget elementor-widget-text-editor\" data-id=\"69b8eb6d\" data-element_type=\"widget\" data-e-type=\"widget\" data-widget_type=\"text-editor.default\">\n\t\t\t\t<div class=\"elementor-widget-container\">\n\t\t\t\t\t\t\t\t\t<p><span style=\"font-weight: 400;\">Loans between family members or friends can result in an entirely unexpected set of problems. Consider why you should not lend money to friends and family and some tips to help you with damage control if you do agree to loan money.<\/span><\/p><h2><span style=\"font-weight: 400;\">1. Open-ended loans<\/span><\/h2><p><span style=\"font-weight: 400;\">Loans to family and friends are open-ended. The parties don\u2019t reach an agreement on a repayment timeline and don\u2019t include interest on the loan. <a href=\"https:\/\/moneyhub.ee\/money\/loans\/\">Lenders<\/a> don\u2019t know when their money will be returned, and borrowers don\u2019t know when to repay the loans.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\">This leaves both parties in limbo and doesn\u2019t set any expectations. The uncertainty can lead to stress as the borrower may worry that the lender expects payment, and the lender worries about when he or she will be repaid. When I loaned money to a family member, it delayed my decision to buy a house.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><i><span style=\"font-weight: 400;\">Pro Tip: If you must lend money to a family member or friend, give them a timeline and a schedule for repaying the loan. The timeline provides a final deadline for total repayment of the loan, and the schedule provides them with guidelines for making monthly payments. For example, \u201cJaan, I\u2019m happy to lend this money to you, but I\u2019ll need the money repaid by 31st December. If you can pay me \u20ac200 monthly, the loan will be paid off by the end of December.\u201d<\/span><\/i><\/p><h2><span style=\"font-weight: 400;\">2. Loans are not a priority<\/span><\/h2><p><span style=\"font-weight: 400;\">With an <\/span><a href=\"https:\/\/moneyhub.ee\/money\/loans\/\">open-ended loan<\/a>, the borrower may need to realise that there is a sense of urgency to repay the loan. Without a deadline, repaying the loan becomes the borrower\u2019s last priority. The borrower won\u2019t face any repercussions for not repaying the loan, like late payments, higher interest fees, or a negative impact on a credit score. Without the threat of penalties, the borrower has no motivation to take the loan seriously or to put any urgency around repaying it.<\/p><p><span style=\"font-weight: 400;\"><br \/><\/span><i><span style=\"font-weight: 400;\">Pro Tip: Talk with your friend or family member and let him or her know that repaying this loan needs to become a priority. Set a deadline for repayment to ensure understanding.<\/span><\/i><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><\/p><h2><span style=\"font-weight: 400;\">3. It\u2019s hard to ask for the money back<\/span><\/h2><p><span style=\"font-weight: 400;\">It can be challenging to request repayment of a loan from a friend or family member. More than likely, the lender cares about the borrower and doesn\u2019t want the borrower to feel awkward. The lender may continue to worry about loan repayment and thus shut down some or all communications with the borrower to avoid talking about the loan. The borrower becomes confused, and hurt feelings can result.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><i><span style=\"font-weight: 400;\">Pro Tip: If you have already lent money to a friend or family member and struggle with asking for the money, take the time to talk to the borrower to resolve the situation. When I had difficulty talking to my family members about paying back a loan, I offered gentle reminders about the loan instead of asking direct questions. This made the discussions easier and less threatening.<\/span><\/i><\/p><p>\u00a0<\/p><h2><span style=\"font-weight: 400;\">4. It can make family meetups awkward<\/span><\/h2><p><span style=\"font-weight: 400;\">I have loaned money to a family member, and I have also borrowed money from a family member. In both scenarios, family get-togethers were very awkward. I felt uncomfortable being around the person who loaned me money. It was also uncomfortable to be around other family members who knew about the loans.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\">No one wants to talk about the loan or about money or even about anything that costs money because then people might wonder why someone hasn\u2019t repaid the loan.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\">Pro Tip: You and the other party came to a private agreement about the loan. Neither party should feel uncomfortable, but if family gatherings seem awkward, keep things lighthearted and steer conversations away from money.<\/span><\/p><h2><span style=\"font-weight: 400;\">5. The borrower asks for more\u00a0<\/span><\/h2><p><span style=\"font-weight: 400;\">Once you have lent money to a friend or family member, this person may return when he or she needs more money. In addition, other friends and family members may also ask you for a loan.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><i><span style=\"font-weight: 400;\">Pro Tip: Don\u2019t become the go-to lender in your circle of family and friends. You should never be in a state of constant lending.<\/span><\/i><\/p><h2><span style=\"font-weight: 400;\">6. Lending money only facilitates more dependence<\/span><\/h2><p><span style=\"font-weight: 400;\">When you lend money to friends or family members, you give them an easy way out of their financial problems instead of helping them work through their issues.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\">For example, your cousin may ask for some money to pay off her credit card bill, but she needs help learning how to make a budget. In that situation, refuse the loan but offer to help your cousin create a budget or look for alternative forms of income.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><i><span style=\"font-weight: 400;\">Pro Tip: Put your friends or family members in a position that improves their financial situation and understanding of money management to help them.<\/span><\/i><\/p><h2><span style=\"font-weight: 400;\">7. Borrower may need the money<\/span><\/h2><p><span style=\"font-weight: 400;\">You want your money returned, but you may also need your money. What if you lose your job and you have no income? What if you spend your entire emergency fund searching for a new job? What if you need to put food on the table for your kids, and repayment of the loan marks the difference between keeping your house or going into foreclosure? You and your family should receive repayment of the loan on time to avoid disaster for you and your family.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><i><span style=\"font-weight: 400;\">Pro Tip: If you have any hint that you may lose your job or that any sort of personal financial downswing is on the horizon, don\u2019t lend money to family members or friends. Tell them honestly that you have a tenuous financial situation and can\u2019t spare the money.<\/span><\/i><span style=\"font-weight: 400;\"><br \/><\/span><\/p><h2><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\">8. You could lose both money and a family member<\/span><\/h2><p><span style=\"font-weight: 400;\">As Shakespeare wrote, \u201cFor loan oft loses both itself and friend.\u201d If you lend money to a friend or family member, beware that you may not get your money back, and your relationship may never return to normal. This will cause tension between you and the borrower and may cause guilt, remorse, and anger.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><i><span style=\"font-weight: 400;\">Pro Tip: The risk of damaging your relationship should be part of the initial discussion you have about borrowing or lending money. For example, \u201cLiisi, I want to help, but I\u2019ve heard horror stories about family members lending each other money. What can we do to ensure this doesn\u2019t happen to us?\u201d<\/span><\/i><span style=\"font-weight: 400;\"><br \/><\/span><\/p><h2><span style=\"font-weight: 400;\">Final words<\/span><\/h2><p><span style=\"font-weight: 400;\">Even though you want to be a good person, and you want your friend or family member to love you, don\u2019t lend him or her money if you can help it. Gently refuse the loan and determine the best way to help your loved ones instead of enabling them.<\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\"><br \/><\/span><span style=\"font-weight: 400;\">Sometimes, loving someone involves doing something they do not want, and they may be disappointed or mad. But if you have their best interests in mind, you can rest easier knowing you won\u2019t jeopardise your relationship.\u00a0<\/span><\/p><p><span style=\"font-weight: 400;\">If you can afford to loan money to a family member or friend, have an open and honest conversation to discuss any potential problems with the loan. Most of the time, issues related to these types of <a href=\"https:\/\/moneyhub.ee\/money\/loans\/\">personal loans<\/a> can be quickly resolved with a frank discussion.<\/span><\/p>\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"<p>Loans between family members or friends can result in an entirely unexpected set of problems. Consider why you should not lend money to friends and family and some tips to help you with damage control if you do agree to loan money.<\/p>\n","protected":false},"author":3,"featured_media":17726,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"om_disable_all_campaigns":false,"footnotes":""},"categories":[21,20],"tags":[],"class_list":["post-5899","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","category-useful"],"acf":[],"blog_post_layout_featured_media_urls":{"thumbnail":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-150x150.jpg",150,150,true],"full":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-scaled.jpg",2560,1364,false]},"categories_names":{"21":{"name":"Articles","link":"https:\/\/moneyhub.ee\/en\/category\/useful\/articles\/"},"20":{"name":"Useful Info","link":"https:\/\/moneyhub.ee\/en\/category\/useful\/"}},"tags_names":[],"comments_number":"0","rttpg_featured_image_url":{"full":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-scaled.jpg",2560,1364,false],"landscape":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-scaled.jpg",2560,1364,false],"portraits":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-scaled.jpg",2560,1364,false],"thumbnail":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-150x150.jpg",150,150,true],"medium":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-300x160.jpg",300,160,true],"large":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-1024x546.jpg",800,427,true],"1536x1536":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-1536x819.jpg",1536,819,true],"2048x2048":["https:\/\/moneyhub.ee\/wp-content\/uploads\/2025\/02\/medium-shot-blurry-woman-holding-post-its.1-2048x1092.jpg",2048,1092,true]},"rttpg_author":{"display_name":"David Bailey","author_link":"https:\/\/moneyhub.ee\/en\/author\/davidbailey\/"},"rttpg_comment":0,"rttpg_category":"<a href=\"https:\/\/moneyhub.ee\/en\/category\/useful\/articles\/\" rel=\"category tag\">Articles<\/a> <a href=\"https:\/\/moneyhub.ee\/en\/category\/useful\/\" rel=\"category tag\">Useful Info<\/a>","rttpg_excerpt":"Loans between family members or friends can result in an entirely unexpected set of problems. Consider why you should not lend money to friends and family and some tips to help you with damage control if you do agree to loan money.","_links":{"self":[{"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/posts\/5899","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/comments?post=5899"}],"version-history":[{"count":0,"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/posts\/5899\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/media\/17726"}],"wp:attachment":[{"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/media?parent=5899"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/categories?post=5899"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/moneyhub.ee\/en\/wp-json\/wp\/v2\/tags?post=5899"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}