How to avoid fights with friends about money
Lending or borrowing money with friends often seems easier than going to the bank – but weâve all been in those tricky situations when one of you canât afford to pay the other back. Here are our top tips for avoiding those awkward money conversations.
When is it okay to borrow from a friend?
Borrowing money from anyone should always be thought through, but there are some occasions when borrowing from friends can be fine:
- When youâre out somewhere without a cash card/wallet/nearby cash machine. You have the money, just not on you, and you fully intended to pay them back.
- You only asked for 40p for a bag of crispsâ¦ I mean câmon!
- You asked them to lend you rent/ food money until your next pay cheque arrives, on the clear understanding you will be able to pay them back then.
- They lent you the ticket price for a big event coming up, say a festival or one-off club night. Youâve agreed a payback scheme over a month or three.
And when is it not OK?Â
- When you know they have no cash, just a generous nature.
- When you have no intention of paying it back (but they expect you to).
- When you are only mates with them for their cash.
- When the amount is too much and you donât feel comfortable taking it.
- When youâre borrowing because you have nowhere else to turn.
Iâm panicking. I promised them their money back and now I donât have it
Even the best laid plans can go to potâ you forget one of your bills needs paying, you have to get a train home for a family emergency, or your car breaks down and now youâre left with higher outgoings than expected and no spare cash to repay your mate.
Crucially, you have to stop avoiding them and talk â sorry! Once youâve had the chat you may find that your friend isnât actually desperate for the money and perhaps will allow you to set up a more realistic payment plan. If that isnât the case and they really need the money back then thereâs support out there to help you from feeling overwhelmed. Call the Money for Life helpline on 0808 801 0666â¯for non-judgemental supportÂ about your specific situation.
My mate owes me and theyâre not returning my messages. What should I do?Â
A friend who doesnât pay back what they owe is not necessarily a bad friend â perhaps just a skint one.
Again, you need to talk to them. This may sound awkward but youâre entitled to ask for your money back. Their response is likely to be âOh! I totally forgot!â.
If theyâre really not able to pay you back, work together on a longer-term solution that suits both of you. Perhaps even show them this article for some top tips.
How can I avoid problems in the future?Â
Regardless of whether they offer or you ask, both sides need to agree some ground rules for the transaction. Depending on the amount and urgency of pay back, you can be more flexible here but generally speaking the lender should say:
- How much they will lend;
- When they expect it to be paid back;
- How they expect payment â lump sum or instalments?
While the borrower (thatâs you!) should be honest about:
- Any difficulties they may have in paying it back;
- When they plan on paying it back;
- How much they can afford to pay back each week/month.
I donât want to get into debt in the first place
Communication is one of the best ways to avoid high debts that feel out of control and scary. Once you see an unpaid bill, donât hide from it. Call the supplier â they have to help you â or call the debt helpline and sort out problems before they start. See ‘Should I get into debt?’Â for more tips.
- Go to Money Advice Service for free and impartial money advice.
- The National Debt Helpline offers free, confidential and independent advice on debt issues. 0808 808 4000
- The Mix is a free, confidential multichannel service giving young people in the UK the support, information and practical tools they need to be healthier, happier and more resilient.