Money is something that is extremely hard to part with. You put a lot of time and effort into earning your money, so it comes without saying that it should be hard to let go of as well. However, there are times when people might be in need of your help and you will have to consider whether or not it is in your best interest to help them out. I’m not saying that you wouldn’t want to help them, but it may not always work out best for you.

1.) Who Are You Borrowing Money To? – Borrowing to your family can be completely different than borrowing to friends. However, both can lead to serious tensions in your relationships. When it comes to family members, sometimes you need to cut your losses and realize that you might not get the money back (that’s what family is for sometimes right?), but when it comes to friends, it is not always as easy to let go of money. If you are really close with your friend, it may be best NOT to lend them money in order to save your friendship. If for some reason the person is not able to pay you back, this can ruin and end your friendship.

2.) Will You Get the Money Back? – Like I said above, one of the biggest things to consider besides who you are borrowing to is whether you think you are going to get the money back or not. Before lending anyone money you need to decide whether to set a day to be repaid by or whether you are going to need to cut your losses and move on. Setting a date of repayment allows you both to have something to go by. However, be prepared for what to do if this date come and you haven’t yet seen the money.

3.) Will You Need the Money? – Another important aspect to consider is whether or not you think that you will need the money yourself. You do not want to give up cash that you will need in the future, because this could lead to you needing to borrow money from someone else. Take into consideration your family, job, and anything else that will be affected by you borrowing money.

4.) What Will You Be Losing? – Depending on how much money someone is asking to borrow from you, then you should definitely consider how much interest you may lose on it from not having it in a bank account. Although the interest does not always add up to much, with the current economy every little bit counts for everyone. Make sure to take into account the interest you will not be earning when you borrow money to someone. Obviously if it is only a couple hundred dollars the interest won’t be as great as if it is a couple thousand.

Borrowing money takes a lot of time and consideration. You may not always have time to consider all your options if someone needs the money as soon as possible. However, at least run through some of the above questions before making your decision. With your hard earned money and job certainty not guaranteed, it is easy to see why you may not want to borrow money. Worried about losing all your money with the current economy? Check out 10 Money Lessons from the Great Depression.

$6,000 could go a long way toward reducing your debt. Win this or other great prizes in the Great Geezeo Bailout!

Photo: Jane M. Sawyer

Further Reading

• Blogger Focus : Living Almost Large (1)
• The ABC’s of Budgeting and Finance : A-E (1)
• 3 Ways to Make Ends Meet Despite a Job Loss (2)
• Is Frugality the Foundation of Great Wealth? (0)
• The ABC’s of Budgeting and Finance : P – T (0)

Tags: borrowing money, Debt, Economic, family, friends, Geezeo, Great Depression, money

This entry was posted on Wednesday, March 11th, 2009 at 6:00 am and is filed under Debt, Economy, Social/Environmental. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.