Saying no isn’t easy, but it’s almost always a mistake to lend money to friends or family members. These tips on how to say no nicely when someone asks to borrow money will help you kindly, firmly, and lovingly decline their request.
“Let today mark a new beginning for you,” says Stephanie Lahart, author of Overcoming Life’s Obstacles: Enlighten~Encourage~Empower. “Give yourself permission to say NO without feeling guilty, mean, or selfish. Anybody who gets upset and/or expects you to say YES all of the time clearly doesn’t have your best interest at heart. Always remember: You have a right to say NO without having to explain yourself. Be at peace with your decisions.”
These tips for saying no when someone asks to borrow money are inspired by a reader. Here’s her question: “I’ve already lent my boyfriend almost $700 about 6 months ago,” says L. on How to Deal With Your Money Problems. “He hasn’t paid me back. The money he makes is not enough to pay his bills school loan, unexpectedly high utility bills, car payments, rent, supporting his parents, etc. He is now asking to borrow $5,000 to help him pay some of his debt so he can get adjusted and financially organized. I want to help him, but he hasn’t paid back the other money I lent him. Should I lend him the money?”
No, no, a thousand times no! She needs to learn tips for saying no when someone is asking to borrow money. It doesn’t matter if he’s her boyfriend or her brother. Below, I explain why I think she should say no to his request to borrow $5,000 – and I offer a few tips on how to say no when someone asks to borrow money from you.
Saying no to friends or family members asking to borrow money is hard, and the truth is you might not be able to say no without damaging your relationship. But, loaning them money is almost guaranteed to damage the relationship — and you’ll be out the money you lent them.
The bottom line is that if a friend or family member doesn’t have money now to organize his life, how and when will he get the money?
A list of reasons my reader needs to say no to her boyfriend’s request for money:
- He already borrowed $700 from her, and can’t pay it back.
- She doesn’t have a contract for the first $700 she lent him, so she’s out of luck if he denies borrowing it, refuses to pay it back, or simply doesn’t have the money.
- Five thousand dollars is a huge amount of money! It’s not $50 to buy groceries, which most lenders can afford to lose.
- In this case, lending him money is not a solution. It is a short-term band-aid that will not help him in the long run.
- Her gut feeling is telling her she should say no to his request to borrow money, but she feels guilty. Her kind, misplaced heart is ruling her smart, savvy head.
Here’s one of my favorite reasons not to lend money to someone who is constantly in financial trouble: “Give a man a fish, and he’ll be hungry tomorrow. Teach a man to fish, and he’ll never go hungry again.”
Instead of throwing more money at someone who has money management problems, encourage him to learn how to organize his finances. Introduce him to Dave Ramsey’s financial makeover system — it really works! Start with The Total Money Makeover: A Proven Plan for Financial Fitness.
How to Say No When Someone Asks to Borrow Money
One reason I believe money should be kept out of relationships with friends and family is because I watch Judge Marilyn Milian. Every day she hears cases that involve ex-partners suing each other over money loans that weren’t paid back.
It’s not out of spite that the borrowed money wasn’t repaid – it was often simply because the borrower didn’t have the money to repay the loan.
If you decide to say yes when someone asks to borrow money from you, read How to Protect Yourself While Loaning Your Boyfriend Money.
Be firm and kind when you say no
You could say, “I’m sorry, but this is a bad time. I can’t afford to lend money to you.” Whether or not you have the $5,000 is irrelevant. It is your money, and you need to decide the best way to put it to work.
Other ways to politely say no when friends or family asks to borrow money:
- “I wish I could help you out – and I love you – but loaning $5,000 is not in my budget.”
- “I know how hard it is for you to ask to borrow money, and I’m honored that you trust me with this. But I’m really sorry. I can’t lend money to you.”
When you’re saying no, try not to over-explain. It’s not a debate, argument, or discussion. Really, you only need to say “No, I can’t help you.” You don’t need to explain why or defend yourself. I know this is much easier said than done.
Love does not mean you say yes to everything that is requested. The key to saying no when someone asks to borrow money from you is to separate money issues from your emotions. Don’t allow your friend or family member to guilt or emotionally manipulate you into lending money.
Offer to help in ways that don’t involve borrowing or lending money
What else can you do to help someone who wants to borrow money? Instead of getting into a debate or argument about why you can’t loan friends or family members money, ask how you can help in other ways.
There are lots of ways to support someone in financial dire straits, depending on his situation. Some people need budgeting help, others need help creating and sending out resumes.
I think the best way for L. to help her boyfriend is to hook him up with a financial planner who will help him organize his income and expenditures. He needs a long-term solution to his money situation – not a short-term loan that will create more financial problems in the long run.
Expect disappointment – and expect to feel guilty
It’s a fact: when friends or family members are asking to borrow money, they won’t be happy when you say no. It doesn’t matter how polite or nice you are…they will be disappointed and upset. They may try to make you feel more guilty than you already do.
Stand firm in your decision. Stay true to your beliefs, and to your gut feeling that you have to say no to the person asking to borrow money. Remember that they are grown adults who WILL find other ways to take care of themselves.
Your role is to support and love your friends and family members – but that doesn’t mean lending money when they’re in financial trouble. If you’re a parent, read Should You Loan Money to Your Adult Children?
I welcome your thoughts on what to do when someone is asking to borrow money. I can’t give advice, but you may find it helpful to share your experience.