Helpful tips when lending money to loved ones

POLOKWANE – Times are tough and with the recent downgrade to Junk status, people will think twice about what they spend their hard-earned cash on.

While helping out a close friend or family member is second nature to most of us, lending money to someone in a serious money-bind with only a promise that it will be returned will be harder to do and can make your relationship awkward.

Zeeva, a specific Debt Management Programme, offers a few things to keep in mind when lending money to your friends and family:

  1. Trust your instincts. If you know the person has a debt record, you know it is not a good idea to loan him or her money. Or if you have already loaned money to someone before and they always make excuses instead of repaying you, why do you want to put yourself through that strain and burden?
  2. Think with your head and not your heart. When it comes to your own money, see it as business and nothing personal.
  3. Manage expectations right from the start and put it in writing. Expectations may differ from person to person but try clearing the term of the loan and the interest rate out together. A full contract will also avoid unnecessary confrontation and arguments in the future.
  4. Never ever sign surety for a loved one or anyone for that matter. Politely decline.
  5. Only lend what you can afford. You can’t help someone if you get yourself into serious debt because of your nice gesture.
  6. Consider the impact it can have. If it is a family member perhaps, what if other family members hear about it, and also start asking for money? Just think about the consequences and do not let your loved ones take advantage of your generosity.

“If you are in the position to lend money to your loved ones, it is indeed a privilege, but it should not be a burden. Take the above tips from Zeeva into account and protect yourself when it comes to your own pocket and money. One final tip to leave you with, if the cash that a loved one wants to borrow is a few hundred rand and you can afford it, rather give it to him or her. Leave it there and write it off. Fighting about a small amount of money is not worth losing the ones you love,” says Carla Oberholzer, public relations officer at Zeeva.

If you are in major debt and in no position to lend your family or friends a ‘money hand’, why not get in touch with Zeeva to assist you with your debt load. Zeeva’s programme is specially designed for women, by women.

  AUTHOR
Maretha Swanpoel

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