The Dilemma of Lending: Personal Reflections on Financial Trust and Friendship
When it comes to lending money to friends or family, the decision can be incredibly complex. It often involves navigating a delicate balance between friendship, trust, and one's own financial security. This article delves into personal reflections on lending and the consequences that can arise from such actions. We will explore the emotional and practical implications of these lending experiences and discuss the value of setting boundaries in financial transactions.
Losses and Setbacks
One of the most memorable incidents of lending occurred when I lent 1200 rupees to a friend during an emergency. It was clear to me from the beginning that he was struggling with financial misfortunes, particularly in the realm of fantasy gaming apps. While we managed to clear his debt, the 1200 rupees I lent were never returned. This experience taught me an important lesson about the risks involved in lending money without proper security measures.
In a similar situation, I lent 300 rupees to a cousin for an exam form. Even though she eventually repaid me a mobile recharge, the experience made me realize that the amount of money lost through such lending can add up over time. In total, I have lost at least 4000 rupees from lending, a significant portion of my hard-earned savings.
Significant Financial Losses
Though these incidents have been hard, one particular case stands out. When I was just starting my career, I lent my hard-earned savings of 1 Lakh INR to a close friend. He promised to return it within a month, stating that this amount would help him succeed. However, it was a mistake. He disappeared, and I never heard from him again. This is a stark reminder of the emotional and financial pain that can come from lending money to friends or family. We were classmates in high school and pre-college, and our friendship truly suffered because of this transaction.
Boundaries and Prevention
After these experiences, I decided to set boundaries in my financial dealings. I became a good accountant, religiously following tracking and reminders. I also used to be quite upfront in asking for repayment, often in public gatherings, to shame the individuals into paying up. While my wife thinks this is rude, I believe it is necessary for maintaining financial integrity. I have asked my friends and relatives twice to return the money, and while the payment was never made, I have noticed that there are fewer money requests now.
One specific incident that highlights my approach involved my aunt. She booked an EMI on my credit card and did not pay it timely. During a marriage ceremony, I bluntly said, 'You have money to buy a new sari and talk about it, but you forget to repay the EMI.' This bold statement led to some initial scolding from my mother, but it also taught my family the value of timely payments. From then on, no one in my family dared to neglect a timely payment again.
Setting Limits and Maintaining Good Relationships
From an early age, I realized that lending money came with its own problems. Discussions about money between my parents often led to stress and worry, making it clear that it was a sensitive topic. When I needed money, I would go to my mom and lie a few times rather than borrowing from friends.
In college, I was fortunate to find five friends who remain my closest companions. We made a rule that money should not be a factor in our friendships, as it can sour relationships. This rule was practical and effective, as we managed any financial dealings openly and clearly. Even counting small change, like 12 rupees, helped us keep our financial transactions transparent and fair.
Throughout my professional career, many colleagues have approached me for money, but I have always refused. This decision stems from the understanding that getting involved in financial transactions can complicate professional relationships. I have chosen to focus on the value of personal finance and the importance of setting clear boundaries, both personally and professionally.
Reflecting on these experiences has given me peace of mind. While lending money can occasionally lead to positive outcomes, it can also result in significant losses. The key is to navigate these situations with due care and consideration, setting boundaries and maintaining financial integrity.