Being in debt to a family member or friend

[Damon]

Have you ever had to pay a debt back to a friend or family member? And maybe it was a big debt that you had to pay off. Would you ever go into debt by borrowing from friends and family? Honestly, I don't think I would ever do that myself, I mean borrow a lot of money from friends and family, because sometimes that could result in problems coming up later between you all. 

[James]

It is strange I make it a rule to not to lend to friends or family as I have been burned to many times. Although if a friend or family member came to me with a business plan and was asking for investment that may be a little different. 

When I was getting started in business without friends and family I do not think I would have made it. Asked for plenty of little loans to fund various little rough patches along the way. So I am very thankful they lent a helping hand. Maybe they only did because I had a clear path to repayment as I would typically need to borrow funds for buying inventory or something when we were getting ready to stock up for a huge promotion. 

It is a very hard thing to mix money, family, and friends. I am going to say it really boils down to the person. You know the ones that will repay their debt and you know the ones that will never put the money you lent to them first. 

How do others handle this? 

[Lana]

I think it depends on a few things. First and foremost, I don't lend money to friends or family often, but when I do, it's a one time thing. I don't lend money multiple times unless I know you're good for paying it back. I put trust in a lot of people in my life, and I would trust many of them to pay me back. 

But, there are friends and family I wouldn't lend money to, not because of anything ill willed, just that they're not good for paying it back. So you really need to trust the people you give money or loans to, because some friends and family will run you dry if they can. 

As well, it depends on you as a person. Do you want to lend money to someone? Can you afford to lend money? It's tough to give people loans, because at the end of the day, it's your money. You worked hard for it, and lending it is going to be tough no matter who it's going to. 

[Sophia]

I have owed family some money before. When I was in my late teens/early 20's, I remember borrowing money from my cousin. She had wanted to go out to eat and I didn't have any money on me. I told her I wasn't even sure if I could pay her back right away. She said no problem and bought it. My meal was something like $13 total. I saw her two days later and she started asking for the money back already. I told her I only had $20 until I get paid which was 6 days out so I had to make it last. She kept asking for it anyways. So I gave her the money and she pulled out this huge chunk of cash and just added it to it like she was almost showing off or something. It made my stomach turn. I stopped talking to her shortly after that and now I will never take money from family again, haven't done it since!

[Scarlett]

I have never borrowed more than $20 from any friend or family because I know it can be messy. I see this with my older brother. He has borrowed money from our mother several times and seldom paid her back and she still brings up each time he didn't to this day. 

[Yonder]

I believe in what James said, it should be a rule not to lend to family/friends. Although employing this rule becomes a bit difficult. When you dont want to lend people think that you're selfish or rude, but the truth is I do it not because I don't want to part with money, but I don't want to deal with the things that come after, or that I don't want to destroy the relationship

[Kuro]

Yes agreed, it is very important to try and not tangle finances with family.

[James]

4 hours ago, Yonder said:

I believe in what James said, it should be a rule not to lend to family/friends. Although employing this rule becomes a bit difficult. When you dont want to lend people think that you're selfish or rude, but the truth is I do it not because I don't want to part with money, but I don't want to deal with the things that come after, or that I don't want to destroy the relationship

Exactly. It really is not about the cash it is about what it does when repayment is not made as planned. It is bad form when someone makes a commitment and does not follow through. I have seen plenty of friendships destroyed over the principal of these kinds of things. I have lent money to family and friends and had it work out just fine but I have also had it go the other way.