Lending money to family and friends might seem like an act of kindness, but in reality, it can create more problems than solutions. Money has a way of complicating relationships, leading to resentment, awkwardness, and even permanent fallout.
Before you reach for your wallet the next time a loved one asks for a loan, here’s why you should think twice—and what you can do instead.
1. Most Personal Loans Are Never Repaid
Let’s be honest—most people who borrow from family and friends don’t pay back. Unlike banks, you won’t charge interest, send reminders, or take legal action. They know this, so there’s no urgency.
You’ll hear excuses like:
- “I’ll send it next week.” (Next week never comes.)
- “I haven’t been paid yet.” (Yet they’re flaunting new purchases.)
- “You have more money than me, so you don’t really need it.” (As if your finances are their business.)
If you don’t want to become an unpaid debt collector, it’s best to avoid lending money altogether.
ALSO READ: How to Borrow Money and Make the Lender Forget You
2. It Creates Awkwardness and Resentment
The moment money enters a relationship, things change. You start viewing them differently, and they start seeing you as a creditor instead of a friend or family member.
- If they don’t pay back on time, you’ll feel frustrated.
- If they avoid you, you’ll feel disrespected.
- If they buy new things before repaying you, you’ll feel betrayed.
They, too, will feel uncomfortable and may start dodging your calls or avoiding you altogether. At some point, you’ll have to choose: Do you want your money back, or do you want to keep your relationship? Because in most cases, you won’t get both.
3. It Sets a Dangerous Precedent
If you lend once, expect more requests. It starts small—maybe ₦5,000 today, then ₦20,000 next time. Before you know it, they’re treating you like their personal bank.
Worse still, they never learn to manage their own finances because they know they can always run to you. Don’t enable bad financial habits by funding them.
ALSO READ: 3 Types of People You Should Never Lend Money To
4. You Might Need Your Own Money—and Not Have It
Life is unpredictable. That money you lent out could be what you desperately need tomorrow. Yet, when you ask for it back, the borrower may not have it, may not care, or may outright ignore you.
Wouldn’t it be frustrating to watch someone else enjoy your money while you struggle with urgent bills?
5. Saying No Protects Your Relationships
Many people lend money out of guilt, but saying no is actually the best way to protect your relationships. Instead of lending, try this:
- Say: “I’d love to help, but I have a strict rule about not lending money to family and friends.”
- If you truly want to help, give an amount you can afford to lose—but as a gift, not a loan.
This way, there are no repayment expectations, no awkwardness, and no ruined relationships.
Lending money to loved ones may seem like a good deed, but it often leads to stress, resentment, and financial loss. Instead, set boundaries, offer alternative help, and protect your relationships.
What do you think? Have you ever lost money (or a relationship) due to lending? Share your experience in the comments!