Experts Lend A Hand With Tips On Lending Money

The smallest bills can cause the biggest stress, especially at the end of the month when due dates seem to come faster than paydays. When the financial outlook is uncertain, many choose to reach out to friends and family for short-term help.

Lending money to friends is a common practice and although people often have the best of intentions, it can sometimes result in sticky situations. According to a recent study by IPSOS and PayPal, 71 percent of Americans have loaned money to family members and friends.

It may seem harmless to help a friend make a car payment or assist a co-worker going through a divorce who just needs “a little help.” But a temporary crisis isn’t always so temporary-and can quickly become an uncomfortable situation if the lender has to ask for the money to be repaid. As easy as it is to lend to someone you know well, it can be just as hard to pester them to pay you back.

According to etiquette experts Kim Izzo and Ceri Marsh, co-authors of “The Fabulous Girl’s Guide to Decorum”and “The Fabulous Girl’s Guide to Grace under Pressure,” money issues between friends and family members are difficult because money is inherently an emotional situation for both parties.

In fact, according to the survey, 57 percent of Americans have seen a relationship end because one person owed the other money. Everyone wants to be a good friend, but no one enjoys feeling like someone is taking advantage of their generosity, say Izzo and Marsh.

“But money lending can be done right,” continues Izzo. “We recommend setting some simple ground rules when considering the possibility of lending money. These ground rules can take some of the stress out of lending to friends and family, and even make it into a positive experience.”

Marsh and Izzo offer several tips for conducting successful financial transactions with friends and family:

• If you’re loaning money to someone close to you and if you’re financially able, consider making it a gift rather than a loan. If not, make it clear you expect to be paid back.

• To make collecting a debt easier and more comfortable, consider using a service called PayPal. This makes it possible to send and receive payments online. With PayPal, you can send e-mail reminders to the borrower. The lender can then get the money back instantly via email.

• Never co-sign a loan or credit card application for someone else without clear, written parameters, and always maintain a business-like environment.

• Don’t lend beyond your means. Only lend money that you don’t need back immediately so as not to ruin your credit or your relationship with the borrower.

“It’s possible to help out a friend or relative in a way that won’t compromise a relationship, while still making sure you’re not left empty-handed,” says Marsh. “Be fair with both the borrower and your own bank account, and hold to your agreements. This will help keep both the relationship and your wallet intact.”

Excellent Cure for Extravagance, and Especially for Mistaken Economy

When you find that you have no surplus at the end of the year, and yet have a good income, I advise you to take a few sheets of paper and form them into a book and mark down every item of expenditure. Post it every day or week in two columns, one headed “necessaries” or even “comforts”, and the other headed “luxuries,” and you will find that the latter column will be double, treble, and frequently ten times greater than the former.

The real comforts of life cost but a small portion of what most of us can earn. It is the eyes of others and not our own eyes which ruin us. If all the world were blind except myself l should not care for fine clothes or furniture.” In America many persons like to repeat “we are all free and equal,” but it is a great mistake in more senses than one.
That we are born “free and equal” is a glorious truth in one sense, yet we are not all born equally rich, and we never shall be.

One may say; “there is a man who has an income of fifty thousand dollars per annum, while I have but one thousand dollars; I knew that fellow when he was poor like myself; now he is rich and thinks he is better than I am; I will show him that I am as good as he is; I will go and buy a horse and buggy; no, I cannot do that, but I will go and hire one and ride this afternoon on the same road that he does, and thus prove to him that I am as good as he is.”


My friend, you need not take that trouble; you can easily prove that you are “as good as he is;” you have only to behave as well as he does; but you cannot make anybody believe that you are rich as he is. Besides, if you put on these “airs,” add waste your time and spend your money, your poor wife will be obliged to scrub her fingers off at home, and buy her tea two ounces at a time, and everything else in proportion, in order that you may keep up “appearances,” and, after all, deceive nobody. On the other hand, Mrs. Smith may say that her next-door neighbor married Johnson for his money, and “everybody says so.” She has a nice one-thousand dollar camel’s hair shawl, and she will make Smith get her an imitation one, and she will sit in a pew right next to her neighbor in church, in order to prove that she is her equal.

My good woman, you will not get ahead in the world, if your vanity and envy thus take the lead. In this country, where we believe the majority ought to rule, we ignore that principle in regard to fashion, and let a handful of people, calling themselves the aristocracy, run up a false standard of perfection, and in endeavoring to rise to that standard, we constantly keep ourselves poor; all the time digging away for the sake of outside appearances. How much wiser to be a “law unto ourselves” and say, “we will regulate our out-go by our income, and lay up something for a rainy day.” People ought to be as sensible on the subject of money-getting as on any other subject. Like causes produces like effects. You cannot accumulate a fortune by taking the road that leads to poverty. It needs no prophet to tell us that those who live fully up to their means, without any thought of a reverse in this life, can never attain a pecuniary independence.