Never loan money to family or friends
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- Опубліковано 2 сер 2024
- We all want to help, but loaning money to people we know (especially friends and family) is a really bad idea. Mitchell Hockenbury explains why loaning money to friends and family changes the dynamic of the relationship as well as why you may be enabling poor behavior.
Mitchell C Hockenbury is a fee-only financial planner with offices in Kansas City, MO and Omaha, NE serving clients locally and across the country. He meets face-to-face with individuals, families, and small business owners in Omaha and Kansas City. He aligns himself to his clients by taking the fiduciary oath and is never paid a commission of any kind. 1440 Financial Partners provides comprehensive financial planning, investment advice, retirement planning, budget assistance, and determining the optimal time to take Social Security benefits. Mitch has a passion for taking complex financial terms and explaining them in plain English so you can organize, grow and protect your assets.
www.PersonalFinanceMadeClear.com
www.1440fp.com - Фільми й анімація
I have a friend when i was down on my luck and out of work she blocked my phone calls. it so happened i got back on my feet and she ends up asking me for a loan, her birthday was coming so i gave her the money she was asking to barrow as a gift because i knew she was not going to pay it back & i wanted to see what she was going to buy with the money . time passed i got a great job and was due a lump of money she needed a car and had made plans to buy a car by asking me to lend the money , i did not lend it to her because she has a family that should help her. i have no family . it made me mad that someone can make plans to spend your money and really care nothing about you..
I wish I knew this sooner. My “best friends” are literally avoiding me now because I need the money and they just keep spending it on stupid things “unconsciously”
their money and they earned. let them spend for what they want
Everything comes back to people but im going through the same shit in a $800 hole
Thank you for giving me such a great advice. That is why I would not allow to borrow money from anyone. I kept my personal information. My money is completely saved up.
Thank you for sharing your thoughts on this subject matter. I have one rule; I do not loan and I do not borrow, period! It applies to all people, family included. Simply put, "genetics" has absolutely nothing to do with my Bank Account. Most if not all users/moochers drive new cars they cannot afford to impress people they do not like. These people are financially irresponsible and rely on borrowing from others who are responsible. The problem is, they always make excuses why they cannot pay back the loan. I have absolutely no compassion for them.
Thanks for the comment Jacqueline. I like the "genetics has nothing to do with my bank account"
@@personalfinancemadeclear5506 Its true, unless you are a conjoined twin, genetics has absolutely nothing to do with your Bank Account.
If you must "loan" money to a family member, ALWAYS assume it is a gift and not expect it to be returned.
"Loans" change how holidays and family get-togethers feel.
I refused a small loan off a family member but said if they want to help me then I needed some fresh fruit or veg at that time.
I think the relationship is already strained the moment someone ASKS for a loan. Giving the loan only ensures you lose money on top of the relationship.
I think depending on the nature of the relationship it may be a good idea to innocolate against this situation by talking about why loaning money is such a bad idea. Long before the situation arises.
That is a great point.... Thanks for sharing. I agree it is a good idea to get ahead of the question.
Your response is point on. If anyone asks me for a loan I tell him or her straight up that I value our relationship too much allow a lender-borrower relationship to potentially destroy the relationship we already have. If I really believe that the money is really needed for a legitimate reason I assess if I don't mind parting with the amount of money requested. If the answer is yes, I either just gift the money without conditions or I make the loan with a due dates(s). If the loan is not paid as agreed then I know the "borrower" is not trustworthy. If this person attempts to ask me for a loan again later I will remind him or her that he or she did not fulfill the prior obligation. The beauty of this is that the "borrower" will know that he or she has lost his or her credibility when it comes to borrowing money and he or she knows that your declining another request is justified. Most of all it preserves your relationship because you were willing to lose the money and this person is less likely to ask you again ever for another loan.
Something I never do after a bad experience. These days I offer them advice and point them to solutions, but lending them money is something I will not do. The only time they will get money is when it's a present.
Excellent point.
@@mitchellhockenbury6494 thank you
If secure enough to loan money, I think it is best to consider the loan a gift. If they pay you back, wow! What they end up using the money for is a reflection of their character. The disguised gift with love and best wishes is a reflection of your character. And if you hound an already struggling person for repayment. If you need that money in the future, absolutely do not loan any of it.
Excellent way to look at it Bob! Love your angle
I started lending siblings money out of love and faith and all I ever received back was disrespect (by the lies they made up to suck me financially dry) getting yelled at (for not wanting to give them more money) and being abandoned by not wanting to return the money .
That's why I don't lend out anymore. I hate lending out now. I just give people hint they should go to the banks instead. The more you lend to them, the more they will resent you. Put all in saving or bonds.
This is so true
The phase is wrong.it should say never lend your money to people.i don't care what the cause is.always say no!!! No matter what..
Thank for the advice i got into a so call investment with my stepson to flip a car he needed 1500 dollars and he was putting in 3,500 dollar the plan was to flip the car and make 1,500 in profit this was on december 8 now nearly 3 months later i have not gotten my money and no profit when i call its always excuses you will get your money so please dont lend money to family or friends it will cause problems.
Thanks for sharing your story.
I would lend money to friends, family, or strangers if there is good collateral. The ones I don't want to lend money to are the ones that live beyond their means.
Good points
I laughed a lot when i saw this video. So, it’s the global issue 😅😅😅. It’s very kind for lending someone money. But why they are not pleased when returning. I lent the friend money. After over 2 years, all I received is the empty promise. And some relatives are same style. Now the debt is huge. So the kindness should combine with the wisdom. Haizza. It’s too funny
I feel so wondered. I asked myself many time that why people behaved like this way. They lowered their worth by money. I feel too sad for them. And they still buy costly stuff. A few recent days, i am wondering too much about this
The first i need is the honest explanation. And if she is struggle, so she should tell me, but no reason, only empty promises
Thanks for sharing... good to know it is happens across the globe!
Well from my past experience I learned one thing. Don't loan friends' money otherwise you will likely lose both
That is unfortunate, but I hear it too often.
Good life lessons
Intresting content...so true😃
I am also facing same problem in my life time I don't give money to my fucking good friends
What if I lended money to a woman?... Am I screwed?
It's too late 🤦🤦🤦
Sir kindly help me
How does it look to ask for 30 bucks from a friend whom I met over 2 years ago on a language exchange app? We know each other and we have been telling our stories and experiences throughout our friendship. I live in one of the poorest countries in the world but that doesn't an excuse to. The real reason to lend/borrow money is to pay for my internet which is a tool in my language learning process. Please chime in.
It is a good reason to borrow money but let me ask u .. are u planing to give the money back , if yes and u have a plan for it then do it
If you don't plan to give back the money by a certain time let him know and if he decided to give u the 30$ it will be his choice
@@hazemkhaled6552 of course, I totally plan to give him back his money.
That is ridiculous what if somoNe is need and urgently needs help, will you keep on holding your money when you can actually help a friend in need
I borrowed a lot from my friends when I was struggling and with gratitude I paid it back still worKing hard to pay the rest .....don't give away money no matter if a friend slips into depression or stress you just hold it tight lol thank God my friends didn't think like that
It sounds as if unlike some people you actually know the definition of "borrow" means to eventually pay the money back, preferably as agreed. It also sounds as if you really needed the money when you borrowed it and had every intention to pay it back. Thanks to your sense of honoring your financial obligations, the person(s) you borrowed the money from are not feeling burned and taken advantage of. Unfortunately many borrowers do not honor the obligation to pay their debts. They seem to "always" be struggling with money, they make borrowing money a habit, and they just have no intention to honor the promise they made to pay it back. In many cases they are struggling because they are living well above their means and they expect lenders to bail them out. Do you understand how irritating it is when you're making financial sacrifices yourself, you lend someone money, they don't pay it back as agreed but yet they're spending what should be your money on luxurious items? It makes the lender feel like a fool and used. The worse part is when you ask for the return of your money they get an attitude and then try to turn it around and make you feel like a villain for exercising your right to collect. This is why as a general rule I do not lend out or borrow money from friends and family. If I don't mind parting with some money I am more inclined tp gift it rather than allowing a loan to ruin a friendship.
@@thedeal9526 hmmm quite right you are too my friend
And yes I do believe it's an responsibility to pay back every penny you take. somoNe helped you so you are suppose to understand and honour their trust in you .....I still feel we should not make any rigid rule if somoNe is really in need help them but yes I understand some people make it an habit too ..
@@infinitystream5356 The reason some have rigid rules is because so many borrowers don't apply and follow rules to themselves when it comes to paying the money back. One of my rules is that the borrower must demonstrate a reasonable way of paying the money back before any funds are given. I wish that borrowers who have no means and/or no intention to pay the money back would just be honest and state that they don't want a loan but a donation. This way the donor can make the donation if he or she decides and won't be disappointed when the money isn't paid back. Like I have said I am more inclined to just gift the money rather than enable someone to not honor their financial obligations. I also wish that those who are asking for loans try to put themselves in the shoes of the lenders as much as they ask the lenders to put themselves in their shoes. Many borrowers are just only concerned with their immediate situation and don't think a second about whether or not the lender can afford to part with his or her money, or it the lender will really need their money back at the time it is agreed to be paid back. All they end up doing is passing their problem on to the lender and in my view it's very selfish. Those who do this make it very difficult to trust anyone.
@@thedeal9526 @infinitystream. I love the discourse and that is one of the reasons I even did the video. From my vantage point I see several people loan money out (and I am trying not to be biased) rather look at the percentage that have difficulty getting the money back on a neat and tidy way. I simply made the video based on the probabilities of these things going well (about 20% 'ish). I love the concept of simply giving the money. In a situation like Infiity's, I'd love to help and would be blown away to get paid back. That shows her character.
Thank you all for making this a better video... it literally is your input that provides context. I'm honored.
This is all true! However, one of my worse experience in life was when a former friend got pissed tf off at me for not lending him more $$$ when he already owes me lots of $$$ he just kept asking and asking and asking me every time for more and more I lend him so much already cuz I know he is broke and needed $$$ all the time but he also has to understand I'm NOT a human ATM either on top of all that I'm ALWAYS buying him cigarettes, food, drinks, while chauffuering him around all the time since his car broke down claiming he will fix it but never did. So when I finally put my foot down and said NO more $$$ lending his head exploded and went through the roof on me I literally went from a "brother" to an enemy in almost no time forgetting about everything I've done for him he would even try to call me out and make me look like bad in front of all our friends in extreme anger that I'm such an a**hole for not lending him more $$$(he's a stupid idiot for doing it without even realizing it) all our friends and I did was just ignore him but he kept on going and going at it we just continued to ignore him he got even more pissed off I've never met anyone like that b4! I mean, how can you get that pissed off @ someone(or even mad at all) when they did so much for you and for not lending you more $$$ when you already owe that person so much $$$? I'll never see my $$$ again he can have it I've moved on the most important thing is I'm so glad he's OUT OF MY LIFE!
The more you lend to that jerk friend, the more he will resent you because you remind him of all debts. Stop lending to any nonsense people. Put it in the saving account or bonds. Stop burning the money.
Going through something similar, this guy is constantly broke and it's been months and i've hardly gotten money back from him. But he just keeps asking for more when he needs something. It's infuriarating