If you’ve ever loaned money to a friend, the following scenario might sound familiar. Your friend is low on cash this month, so you lend them $1,000, thinking they’ll repay you promptly. A month passes by, and you see them at a restaurant ordering wine or wearing a shirt you’ve never seen before.
Pretty soon, you start going down a rabbit hole, scrolling through social media and wondering how they can afford to go on a trip or purchase a TV when they haven’t paid you back. That’s certainly less-than-helpful for the intimacy of that friendship.
Below, we asked certified financial therapists everything you need to know about lending money to friends and how to prevent this from ruining your relationship.
Can you afford to lose the money?
The issue: Lending money to a friend comes with the possibility of not getting it back. Let’s say you loan them $1,000 and then your car breaks down or you need to take your dog to the vet.
