Do not lend money you can’t afford it

Time to get serious with y’all…

I had an eye-opening conversation with a friend recently who ended up in his overdraft one month because he had decided to lend two friends some money to help them out before payday (but hadn’t taken into account his own finances).

Yes, he earns more money than them on a monthly basis, but remember that you do not owe anyone anything.

If you earn more money than your friends/family, it does not automatically mean they are entitled to a cut of your paycheck!

The size of your paycheck is not a reflection on whether you are  in a position to lend out money. And even if you are financially stable enough to do so, and do have that money readily available, you are still entitled to say no.

(I completely appreciate how all circumstances are different,and how hard it can be to say no to some people, especially family members).

That is one issue with having savings (and people knowing about it) – you become the go-to person for personal loans.


Lending money when you can’t afford could lead to:

  • You being short for the month and being financially crippled
  • You being in (more) debt and affecting your credit score rating
  • You having to borrow money from someone else… a vicious cycle!


If you can afford to lend that money in the first place, then it simply comes down to whether you would like to lend it or not, and if you are okay with the fact it may take a while for that money to return to you (depending on who you lend it to and what their financial position is). Unfortunately I cannot help you make that decision, however, the one rule to live by when it comes to lending out is;

Only ever lend money to people when you KNOW you can afford it

Two examples of ‘being able to afford it‘ would be:

  • You have money in your savings account (that does not need to be available for your own use just yet)

  • You have some disposable income for that month (after your own bills and outgoings)


Unless it is a matter of life or death for the person who needs the money (I can leave you to work out the criteria for ‘life or death’), if you do not fall into one of the two categories above, then my suggestion would be do not lend out your money. It is circumstances like this where you have to put yourself first. Be a little selfish and put your own goals of becoming financially free at the forefront of your agenda.

Don’t get me wrong, it is really nice to be able to help someone out. I lend out money to people all the time, people call it The Bank Of Laura.

But this is a choice I make with the knowing that not only do I trust that the money will be paid back in full when promised, I also know it will not affect my own finances – and that is key.

Before you agree to lending money, take time to sort through your own finances and ensure you can afford it.

Also do not worry about saying no if you can’t afford it. I am sure that if the person is a close enough to you to be asking to borrow money, then they wouldn’t want to personally put you into a bad financial position.

Happy lending (if you can afford it!).

Laura x



Author: Laura Moore

I am a 26-year-old living in London and currently learning how to live my absolute best life whilst still being financially stable… everyone’s dream right? That is the journey I am on and I learn something new every day, so I am documenting and sharing my experience. I want to show you how you can have fun and still have money, at the same time. It doesn’t have to be one or the other. My mission is to help you become financially free. After making a very last minute to decision to go travelling in 2015, with the money I had saved ready for Drama school, it was then that I realised the freedom that money can give you. I want to demystify money and help you all feel empowered by your finances. Talking about all aspects of saving, budgeting, clearing debt, investing (and many more), I am here to help you take control of your money.  

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