A friend in debt - how to handle?

getmore4less

Do you have any idea how big these debts are?

Mojisola

fluffnutter wrote: »

Hmm, it's a lovely gesture but... once he's paid off the loan to you (or even before) what's to stop him getting more payday loans any time he finds himself a bit short of cash?

That's a judgment princessdon would have to make, knowing the lad and his personality.

Not everyone who gets into money problems once is a lifetime overspender.

FBaby

I think you can never be sure how it might go. Some learn after their first mistake (I did, so did my partner, so did his sister!), however, others fall into psychological traps and never seen to learn to restrain themselves.

I think you are going to help someone you care for, you have to accept that they might not learn from it however much you try to teach them to budget. The key thing though is that you don't do it again and make very very very clear from the start that this is their chance and there won't be another one.

princessdon

No I want to clear it and I will (he will probably refuse at first), I know exactly how much and thank god it's not a lot, he's applied for a zero percent cc and been accepted for a 2k limit, so his other debts can be manageable, and have a 12 months plan. The debts (incl) the pay day loan should take 9 mos or 6 mos if not starting a savings plan.

It's the daily interest on these that I'd rather pay off quickly. I've invited him and nephew for tea so will discuss it then.

Thanks all

scooby088

OP never lend money you cannot afford to lose, if you cannot afford it then I wouldn't worry about helping him out.

princessdon

quinechinoise wrote: »

I think his problems have/had more to do with relationships than money. Do you think he's likely to fall into similar patterns in the future? As the equivalent of an auntie, perhaps you (or your husband) could discuss that with him. He seems to be comfortable talking about his problems with you, so warning him to steer clear of users will do more than waiting for him to slowly pay off a large financial debt.

If you can afford to gift/lose the money, then gift it. He is obviously a close family member, regardless of mere blood, and he sounds like a good lad. Tbh, I think you may have difficulty compelling him to accept your gift!

It's a bit of both - he met a girl who comes from a different background and had high expectations. He spent a lot of money on holidays, restaurants, taxis and the camels back of christmas. She sent a text on New Year's Eve telling him she was back with her ex.

I see it as a gift (one I'd like them to use wisely of course). The problem is that he craves the "good life" and things he never had growing up. He likes the fact he now has cash and doesn't use it wisely and likes to show off. I am not 100% convinced he will ever be a saver as money burns holes for him, but he's not got into debt before now.

getmore4less

Is there any risk that lending the friend may alienate the nephew.

princessdon

getmore4less wrote: »

Is there any risk that lending the friend may alienate the nephew.

No - it was my nephews suggestion he spoke to me. My nephew wanted to lend it initially but he can't afford to lose it. As I said I'm also looking at this being a way to pay back what my family technically owe him as he returns all money we pay for jobs. My nephew wants him to take money we give, it just always ends up under the tv etc a week later. He does a lot for us - like yesterday when he helped with his van to move a wardrobe and wouldn't take petrol money even for a 100 mile trip.

getmore4less

Looks like he a good un(perhaps too good) just hit a bad patch

Sounds like he needs a lesson on mates rates rather than doing stuff for free all the time.

The thing with saving is some people need goals to trigger the process.

Perhaps help him with defining some goals that need savings that are more important than living the moment.

princessdon

getmore4less wrote: »

Looks like he a good un(perhaps too good) just hit a bad patch

Sounds like he needs a lesson on mates rates rather than doing stuff for free all the time.

The thing with saving is some people need goals to trigger the process.

Perhaps help him with defining some goals that need savings that are more important than living the moment.

He's a good lad just generous to the point it's a fault. Eg the reason he refused petrol money yesterday was because I picked him and nephew up from a club on NYe to save on taxis.

It was nephew I picked up really - as can't see nephew paying £100 on a taxi when I can pick him up, but of course dropped him off as on route.

Thank you all for your advice - I know what to do