Money moral dilemma

chubsta

'lend' them the money, but have it set in your mind that you are actually 'giving' it to them - if they pay it back to you then great! but if they don't, and to be honest they probably won't as if they had enough money to pay it back then why cant they save it up, it is not a huge amount after all, then at least in your own mind the money was always gone anyway.

NeilCr

Again, thanks everyone

A couple of points in response to some of the posts. My friend will not be a lot worse off than me. There is a large amount of equity in the house and he is downsizing dramatically. Quite how he has got into this short term situation I don't exactly know. The money is to help pay some of the removal costs

While I understand the comments about drawing down from investments I am comfortable financially and can afford to lend him that amount. Whether it could be done quickly enough is a different issue

I, genuinely think he would pay me back. The dilemma for me, at least, is helping a friend vs getting involved financially with one - something I am not keen on at all following the sale of my flat to another mate. Our friendship survived but there were some tense moments

As it happens my friend messaged me late last night to say he is trying a couple of other methods to raise the funds so my problem may be resolved

Sea_Shell

If I had to take from investments rather than cash savings, then I'd say "sorry, but I can't access those funds, they're tied up in investments."

If he's short this month, who's to say he won't be short again next month, even if he pays you this bit back...this could just repeat and repeat, every time something crops up that he's not budgeted or saved for.

Pollycat

NeilCr wrote: »

Not through MSE HQ! - so you can get more context if needed

And more for the discussion...

A good friend of mine has asked me to lend him £750. It's to tide him through a difficult period - moving house - and, while, he is not great with money, I know he will pay it back.

I can afford it although it will mean digging into some investments but I have a general dislike for getting involved in financial transactions with friends. I sold my flat to my best mate and that wasn't the best experience. Fortunately (and because we are so close) the friendship survived

I think I know how I am going to handle this but what would you do?

NeilCr wrote: »

The practicalities of getting the money out could be a problem time wise. That's something I have to chat with my IFA about. I am fine about what I say to him one way or the other

I guess it's the underlying issue of getting involved with a friend, financially, which is the problem


And, yes, I totally get the not touching the investments even for me point.

I'd be concerned if I didn't have a spare £750 for myself without needing to dig into investments.

Zero_Sum wrote: »

If you are needing to draw down investments, Id argue you cant afford to loan the money.

I agree with this.

If you don't have the £750 easily accessible, I would say 'no' in your position.

However, If a good friend of mine was in the same situation and asked to borrow £750 on a short term basis and I knew they would pay me back, I would have the money available and would lend it to them.

So for me, the dilemma isn't about whether you should lend your friend the money but about your own financial circumstances.

NeilCr

Pollycat wrote: »

I'd be concerned if I didn't have a spare £750 for myself without needing to dig into investments.

I agree with this.

If you don't have the £750 easily accessible, I would say 'no' in your position.

However, If a good friend of mine was in the same situation and asked to borrow £750 on a short term basis and I knew they would pay me back, I would have the money available and would lend it to them.

So for me, the dilemma isn't about whether you should lend your friend the money but about your own financial circumstances.

My financial circumstances are absolutely fine - honestly!

:beer::beer::beer:

I have a pretty reasonable amount invested. I rely on my pensions and regular income withdrawals for day to day living and draw down a lump sum as and when needed for bigger purchases etc. As said (and you highlighted) there might well be a problem in getting the money out in time for when my mate needs it - especially at this time of the year

keith969

I had this situation a couple of years ago. My ex's sister - who has always been a true friend - did not have enough to pay the rent one month. I said I'd 'lend' it to her, but never expected to get it back - so it was giving, not lending, which imho is never appropriate to real friends/family.

Accountant_Kerry

If you are happy to never get it back then lend it, if you aren't then don't

onwards&upwards

NeilCr wrote: »

My financial circumstances are absolutely fine - honestly!

:beer::beer::beer:

I have a pretty reasonable amount invested. I rely on my pensions and regular income withdrawals for day to day living and draw down a lump sum as and when needed for bigger purchases etc. As said (and you highlighted) there might well be a problem in getting the money out in time for when my mate needs it - especially at this time of the year

£750 is not a huge amount of money and not beyond the realms of what you might need access to very quickly in an emergency. Especially if you are a homeowner.

I agree with pollycat, you should definitely look at having at least a few grand that you could lay hands on instantly. There are some current accounts and a few savings account with decent rates that allow instant access.

NeilCr

onwards&upwards wrote: »

£750 is not a huge amount of money and not beyond the realms of what you might need access to very quickly in an emergency. Especially if you are a homeowner.

I agree with pollycat, you should definitely look at having at least a few grand that you could lay hands on instantly. There are some current accounts and a few savings account with decent rates that allow instant access.

I have a credit card with more than enough on it for real emergencies. I don't use it much so plenty of headroom (in your thousands) if needed. I'd be very reluctant to go that route with my friend - although, I accept it would be quicker to draw the cash using that.

Now the discussion is continuing I think drawing out from the investments is a side issue (this thread has clarified my thinking a bit). My real dilemma - as articulated earlier - is the helping a friend vs getting involved financially with one

I get the point - made by others - that maybe regard it as a gift rather than a loan. However, given the amount I know he will be getting from the house sale I would struggle a bit if he didn't pay it back (I do believe he would).

It's my brain working I guess. In the end I think I should lend him the money but can't get rid of the niggle!

onwards&upwards

NeilCr wrote: »

I have a credit card with more than enough on it for real emergencies. I don't use it much so plenty of headroom (in your thousands) if needed. I'd be very reluctant to go that route with my friend - although, I accept it would be quicker to draw the cash using that.

Oh god definitely don’t do that!