Nothing brings a family closer than borrowing and lending money to each other right? What could possibly go wrong? Well, I was close to finding out! Recently, a family member who has NEVER asked me for money needed to borrow $1500 for some dental work. More specifically, they wanted to borrow my credit, and they would pay that credit card back on their own. But before answering, I had to run The Shiny Dollar Credit Check. These are the questions I would ask before allowing family to borrow your cash or credit.
Check Yourself Before You Wreck Myself
I listened to the plan obviously. If I let them borrow $1500, they would pay it back in 6 months. They offered interest which I declined. The pitch also included how everything they needed was about $11,000, but they could get it done with $1,500. They’d figure out the rest later. After they explained to me the plan I asked them a few questions.
How stable is your job?
They answered “very stable”.
Unfortunately, about a month ago, they told me a company recently purchased their employer so everyone’s job was up in the air…
How Long Have You Been Working in The Company?
“13 Years”. Awesome! Not a lot of people go that long without changing jobs! They must be doing something right to still be there.
In those 13 Years, how much money have you been able to save?
$0. No savings account, no 401k, no IRA. Nothing. Nada.
And that’s where the problem came in….
So if you’ve saved $0 in 13 years, what makes you think you can save $1500 in 6 months?
It was a jerk question, I know… But I like people to be realistic. I like to know how people’s minds work when it comes to finances. Would they tell me that they just didn’t want to save anything? That they knew they were spending on things they shouldn’t have?
Instead, they just changed the subject and told me they really needed to get this procedure done.
You told me once you allowed a family member to borrow your credit, how did that go?
Another jerk question… I knew the answer. This person allowed their brother to use their credit and their brother never paid a penny to the loan. The same reason they couldn’t use their own credit now.
No Need To Answer
I wasn’t looking for an answer. I wanted them to know why I make my decisions the way I do. To see some type of understanding. Of course, no one is understanding when they don’t get their way.
Regardless, this is someone who means a lot to my wife, so I answered in my own way.
I’ll Give You The Money
Little by little. Unfortunately, as I’m not currently working, and it is definitely affecting my paycheck, I need my savings.
I didn’t want to let them borrow the money. When you lend money, you have an expectation to be paid back. So when they miss a payment, but you see they got new shoes, it irks you a whole lot.
Now if I could afford to just give them the money, I have no expectation to be paid back at all. If I do happen to be paid back, well great! But if not, I did the math and I can afford to live without it.
There is never an easy answer when it comes to family and money. The closer they are to you, the harder it becomes. Have you ever been put in this position? If so, how did you handle it?