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5 Golden Rules For Lending Money To Friends And Family

5 Golden Rules For Lending Money To Friends And Family

You may not be able to buy friendship with money, but you can certainly destroy friendships with it.

Lending money to friends and family is a very delicate affair, and like Dave Ramsey, I would flat out recommend never lending friends money, since money is always a difficult subject to talk about, personal loans can often lead to communication breakdowns which can wreck any relationship.

That said, if you really want to loan your friends some money, here are 5 key tips to follow to ensure that this loan does not destroy your relationships. If you are really lucky, you might even get back the money you loaned.

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1. Understand that you probably won’t get the money back.

If your friends or family are asking you for a loan, then they are not asking a bank for a loan. That is not a good sign. If you do want to loan out money to them, you need to stop and think about how important getting the money back is compared to not ruining your relations. If the latter is more important to you, it may be better to just make the loan a gift.

However, if you decide to make it a loan, you need to consider how important it is to get that money back. You need to be consistent about this, so that both you and the person you are loaning it are on the same page when it comes to paying the loan back.

2. Make a contract.

Your friend may want to make the loan a handshake agreement, promising that they will pay the money back at a certain point. Don’t let them.

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As you are making the loan, you get to set the terms. If you want your money back, a handshake agreement means nothing – a contract does. You can get a free promissory note here from Suze Orman which will let you set the terms of the loan. Also, get the loan signed by both of you and notarized. The latter part is critical.

If the worst comes to worst and you decide to take your former friend to court, a notary can stop them from claiming that they never signed anything. Your friend should have no problem being specific about repayment terms if they really intend to pay you back, so hold them to their word and get the contract written.

3. Don’t expect any favors back.

When someone owes you money, you may feel like they owe you something beyond the cash you gave them. You might think they should help you out with that weekend project you’ve got, or buy you a drink next Saturday.Thinking like that is a bad idea.

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If you signed a contract with your friend, then your friend agreed to pay the money back and nothing else. Expecting more is improper and makes it look like you are lording your better finances over him. Don’t hesitate to be firm about getting your money back, but don’t use it to get other perks or favors from your friend.

4. Ask if there are other ways you can help.

There are always other ways to help your friends beyond giving them money. You can teach them ways to make or save money. You could also help them around the house or office. If they are having problems with bills, you could even offer to pay the bill directly instead of loaning them the money.

If your friend is asking for help with a personal finance loan because they have a problem. Find out what the problem is and see if there are other ways you can help fix it. If they do not want to tell you, then point out that they have no right asking you for money if they won’t tell you what the money is for.

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5. Learn to say “no”.

As noted at the top, I would recommend against loaning any of your friends or family money; however, you may also have some close people who you consider reliable who have just hit a rough patch, and are confident that they will eventually repay you.

On the other hand, there are those family members who you would never trust with 50 cents. I have a family member who is incredibly compassionate and heart-warming – and that is the exact reason I would never loan her anything, because I know she would blow the money on the first sob story she ran into.

At certain points, you just have to say “no”. Your friend or family member may get mad, cry, or throw a tantrum, but this is your money. Offer other help as noted above, but learning to say “no” is critical to succeeding in general.

If your friend is willing to break it off with you over a sum of money, then they were never really much of a friend at all.

Featured photo credit: Next Avenue via nextavenue.org

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Last Updated on September 12, 2019

12 Things You Should Remember When Feeling Lost in Life

12 Things You Should Remember When Feeling Lost in Life

Even the most charismatic people you know, whether in person or celebrities of some sort, experience days where they feel lost in life and isolated from everyone else.

While it’s good to know we aren’t alone in this feeling, the question still remains:

What should we do when we feel lost and lonely?

Here are 12 things to remember:

1. Recognize That It’s Okay!

The truth is, there are times you need to be alone. If you’ve always been accustomed to being in contact with people, this may prove difficult.

However, learning how to be alone and comfortable in your own skin will give you confidence and a sense of self reliance.

We cheat ourselves out of the opportunity to become self reliant when we look for constant companionship.

Learn how to embrace your me time: What Your Fear of Being Alone Is Really About and How to Get over It

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2. Use Your Lost and Loneliness as a Self-Directing Guide

You’ve most likely heard the expression: “You have to know where you’ve been to know where you’re going.”

Loneliness also serves as a life signal to indicate you’re in search of something. It’s when we’re in the midst of solitude that answers come from true soul searching.

Remember, there is more to life than what you’re feeling.

3. Realize Loneliness Helps You Face the Truth

Being in the constant company of others, although comforting sometimes, can often serve as a distraction when we need to face the reality of a situation.

Solitude cuts straight to the chase and forces you to deal with the problem at hand. See it as a blessing that can serve as a catalyst to set things right!

4. Be Aware That You Have More Control Than You Think

Typically, when we see ourselves as being lost or lonely, it gives us an excuse to view everything we come in contact with in a negative light. It lends itself to putting ourselves in the victim mode, when the truth of the matter is that you choose your attitude in every situation.

No one can force a feeling upon you! It is YOU who has the ultimate say as to how you choose to react.

5. Embrace the Freedom That the Feeling of Being Alone Can Offer

Instead of wallowing in self pity, which many are prone to do because of loneliness, try looking at your circumstance as a new-found freedom.

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Most people are in constant need of approval of their viewpoints. Try enjoying the fact that  you don’t need everyone you care about to support your decisions.

6. Acknowledge the Person You Are Now

Perhaps you feel a sense of loneliness and confusion because your life circumstances have taken you away from the persona that others know to be you.

Perhaps the new you differs radically from the old. Realize that life is about change and how we react to that change. It’s okay that you’re not who you used to be.

Take a look at this article and learn to accept your imperfect self: Accept Yourself (Flaws and All): 7 Benefits of Being Vulnerable

7. Keep Striving to Do Your Best

Often those who are feeling isolated and unto themselves will develop a defeatist attitude. They’ll do substandard work because their self esteem is low and they don’t care.

Never let this feeling take away your sense of worth! Do your best always and when you come through this dark time, others will admire how you stayed determined in spite of the obstacles you had to overcome.

And to live your best life, you must do this ONE thing: step out of your comfort zone.

8. Don’t Forget That Time Is Precious

When we’re lost in a sea of loneliness and depression, it’s all too easy to reflect on regrets of past life events. This does nothing but feed negativity and perpetuate the situation.

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Instead of falling prey to this common pitfall, put one foot in front of the other and acknowledge every positive step you take. By doing this, you can celebrate the struggles you overcome at the end of the day.

9. Remember, Things Happen for a Reason

Every circumstance we encounter in our life is designed to teach us and that lesson is in turn passed on to others.

Sometimes we’re fortunate enough to figure out the lesson to be learned, while other times, we simply need to have faith that if the lesson wasn’t meant directly for us to learn from, how we handled it was observed by someone who needed to learn.

Your solitude and feeling of lost, in this instance, although painful possibly, may be teaching someone else.

10. Journal During This Time

Record your thoughts when you’re at the height of loneliness and feeling lost. You’ll be amazed when you reflect back at how you viewed things at the time and how far you’ve come later.

This time (if recorded) can give you a keen insight into who you are and what makes you feel the way you feel.

11. Remember You Aren’t the First to Feel This Way

It’s quite common to feel as if we’re alone and no one else has ever felt this way before. We think this because at the time of our distress, we’re silently observing others around us who are seemingly fine in every way.

The truth is, we can’t possibly know the struggles of those around us unless they elect to share them. We ALL have known this pain!

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Try confiding in someone you trust and ask them how they deal with these feelings when they experienced it. You may be surprised at what you learn.

12. Ask for Help If the Problem Persists

The feeling of being lost and lonely is common to everyone, but typically it will last for a relatively short period of time.

Most people will confess to, at one time or another, being in a “funk.” But if the problem persists longer than you feel it should, don’t ignore it.

When your ability to reason and consider things rationally becomes impaired, do not poo poo the problem away and think it isn’t worthy of attention. Seek medical help.

Afraid to ask for help? Here’s how to change your outlook to aim high!

Final Thoughts

Loneliness and a sense of feeling lost can in many ways be extremely painful and difficult to deal with at best. However, these feelings can also serve as a catalyst for change in our lives if we acknowledge them and act.

Above anything, cherish your mental well being and don’t underestimate its worth. Seek professional guidance if you’re unable to distinguish between a sense of freedom for yourself and a sense of despair.

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Featured photo credit: Andrew Neel via unsplash.com

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