What would you do (loaning friends and family money)

[mammasita]

Let me start by saying that I am not rich. I am comfortable and have the means to do things and buy "wants" here and there for myself and my son.

While I enjoy helping and doing things for people here and there, I'm not comfortable when people ask me to borrow money - no matter who it is. I'd be more than happy to buy groceries, or pay a small necessary bill - but just letting money exchange hands - not exactly ideal. Well, OK, with the exception of my mom, dad and aunt who have never EVER asked me to loan them money - however, they have always done for me, so I don't think I would even loan them money, it would be given to them, no question.

I digress.

My boyfriends sister struggles ALOT. She asked us if she could borrow 150 dollars to get her car fixed. 150 is the remaining balance after her mom pays the first 400-500 for the work that needs to be done. My boyfriend doesn't have the extra money floating around to loan her so she asked me. I don't want to become the person who will loan money out to their family. They are not my responsibility (man that sounds selfish ). His sister is kind of frivolous for someone who struggles to pay rent and buy food. I mean, I understand she is struggling, but where is the money coming from that she uses to get her nails done every couple weeks. Now I know her car is truly messed up, so I'm not concerned that she will take the money and do something else with it (even so, if I did do this for her, I would go to the car place and pay them myself instead of pass around money).

I decided that I wouldn't loan her the money based on the fact that we're about to go on a mini-vacation (son, BF and I) to Universal Orlando and that is not a cheap trip between hotel, flight, park tickets, food....UGH. While I feel terrible saying no (based on upcoming trip mostly) I don't think I would have loaned her the money anyway.

[loose seal]

You made the right decision, imo. If she were truly in dire straights money-wise (no money for any luxuries like nails or cell phone or what have you) then that might be a different story but from what you've written she isn't there. She has a broken car and mom pays for nearly all of it and now she's looking for someone else to pay the remaining bill? Where is she taking responsibility for her broken car, cause I'm not seeing that at all. If she has to sacrifice something in order to get her car back hopefully she'll learn some personal responsibility rather than relying on someone else to come to her rescue.

Many, many moons ago I was very young and dating Danny S. Danny had a cool mustang that something broke on and required fixing. I've always been a saver so when he needed $1,500 to fix his car I happily loaned it to him because I had the money. Yeah well of course we broke up and it took nearly a year of me badgering him to finally get my money back. For me it was a great lesson learned about lending money to people.

[mammasita]

Originally Posted by loose seal

You made the right decision, imo. If she were truly in dire straights money-wise (no money for any luxuries like nails or cell phone or what have you) then that might be a different story but from what you've written she isn't there. She has a broken car and mom pays for nearly all of it and now she's looking for someone else to pay the remaining bill? Where is she taking responsibility for her broken car, cause I'm not seeing that at all. If she has to sacrifice something in order to get her car back hopefully she'll learn some personal responsibility rather than relying on someone else to come to her rescue.

Many, many moons ago I was very young and dating Danny S. Danny had a cool mustang that something broke on and required fixing. I've always been a saver so when he needed $1,500 to fix his car I happily loaned it to him because I had the money. Yeah well of course we broke up and it took nearly a year of me badgering him to finally get my money back. For me it was a great lesson learned about lending money to people.

Exactly. All I can think is "dang, you don't have money to fix your car, but your nails are done and you've had McDonald's for lunch 3 times this week?"

I also loaned an ex boyfriend about 1200 dollars to get his car fixed because someone stole his headlights while he was parked on the street in Queens NY (why someone needed Acura headlights, I will never know LOL). We stopped talking and it took about a year for him to send me a money order in the mail so I can relate.

[bandit2]

You made the right decision - a car is not a necessity & many take public transportation. In the past, anyone I lent money to became a habit quickly.
Came to point I made it a "policy" not to lend money.
Some people need to take ownership for their problems & you are helping more for making them get creative for their own responsibilites.
They will figure it out.

[mammasita]

Originally Posted by bandit2

You made the right decision - a car is not a necessity & many take public transportation. In the past, anyone I lent money to became a habit quickly.
Came to point I made it a "policy" not to lend money.
Some people need to take ownership for their problems & you are helping more for making them get creative for their own responsibilites.
They will figure it out.

Agreed. Not loaning out money has actually unofficially been my policy too (well after that headlight/Acura loan LOL). and yes, that is my fear exactly, that I help her once, then next thing you know it becomes a habit.

[bargoo]

I agree, don't do it.

[sontaikle]

I really think you did the right thing. I don't lend out anything above $20 to anyone but my immediate family because it can really ruin relationships. I also don't ask for money and probably won't unless some emergency comes up because I hate being in debt.

I could understand if something happened that caused her to be in a dire financial state--illness, job layoff, house fire, etc.--then the situation would be VERY VERY different and I think you wouldn't even be writing about this.

[Italiannie]

You absolutely did the right thing. My husband and I have decided that if someone is in real need, that we would gift them some $, and we have had occasion to do that. We don't have lots of money, but we're very careful with what we have.

It seems like your boyfriend's sister has a wants vs needs entitlement thing going on. I would never get my nails or hair done if there was a bill to pay.

I do have a sister who is sometimes is in need of some cash. I offer her opportunities to earn it (cleaning my mom's apartment, etc.) She is very grateful and in a few hours can earn enough to tide her over. If your boyfriend's sister is really in need, and you have the means, offer her an opportunity to earn it. Then you'll know how sincere she really is. Also, if she earns it, then it is hers indeed.

Just my humble opinion.

[ddc]

I listen to Dave Ramsey (financial advice guy) on the radio and I believe in what he says--if you loan people money (which he advises against) do it in the gesture as a gift and don't expect to get the money back. He also says that if someone is constantly bailing someone out, lending them money, etc., they never learn to change their spending habits so that they have money for when emergencies (like car trouble) occur.

[ArtyKay]

How does that saying go?..."Neither a borrower nor a lender be.." I think.

That goes triple for family/friends. Not only is it a bad idea to lend money to begin with, but when money changes hands between friends/family, it automatically puts money in between your relationship. It can strain ANY relationship.

My dad has always told me, "don't ever lend money. When you give somebody money, its a gift. Don't expect it back, and once you've done the favor, drop it. Never mention it again." Great advice. And that's only for NEED situations.

You did the right thing..that would've not only come between you and her, it could have put a strain on your relationship with your bf as well.

[MindiV]

Sounds like my sister-in-law. She has a 4 bedroom house with cheap mortgage payments, and she and her husband work. Their two kids wear nice clothes, have tons of "toys" ranging from little kid stuff for the young one to video games for the teenager. They're always going out of town to watch the oldest one's basketball games and buying expensive things. Heck they have five TVs - all flat screen, nice ones.

But she "can't afford" to do a lot. When DH and I first got together she always came to him for money. I finally told him to stop, that we had our own stuff to deal with, and eventually would have our OWN family to pay for. They have money and can take care of themselves or live within their means.

That said, I think keeping an open mind is necessary. Sometimes a legitimate emergency could come up, and if that happens we'll give them money. With her it's never a loan.

[ERHR]

Your instincts are correct, along with all the other commenters. Never loan money to family or friends - only give it, if you can. Suggest to your boyfriend's sister that she check out some peer-to-peer lending sites. Maybe having to ask strangers for money and actually pay them back will shock/embarrass her into managing her money better in the future.

[124chicksinger]

Yup. Agreed. We've been burned by lending money to our sister in law who constantly puts herself in debt. Last time she asked, we had to say no. Matter of fact, I'm broke myself and can't afford to support other people's bad spending habits. Don't even start, and do NOT feel badly about saying no.

[MissGuided]

I can imagine how hard it was considering it is family. I've been there, done that.
But you made the right decision.
You work hard for your money and you deserve to spend it on your family.
Good job!