|
 This survey originally ran in
the 10/9/02 DebtSmart
Email Newsletter.
To take the survey click here.
Some interesting results:
| 1) |
70%
report that they've lent to family with only 38% saying they were
paid back in full. However, when asked if they'd lend money
again 59% said yes! |
| 2) |
59%
reported lending money to a friend and 27% were paid back in
full, but when asked if they'd do it again 37% said yes.
This indicates to me that overall, lending to family has
worked out better than lending to friends. |
| 3) |
The
"no's" have it when questioned about working with a third party
to manage loans between family and friends (about 65%). |
| 4) |
The
majority agree on both the borrowing and lending sides that it
is fair to charge and repay interest fees when lending or
borrowing from family and friends. |
| 5) |
40%
said that a reasonable amount to charge for interest is between 4%
and 8%. |
Have you ever lent money to a family
member?
 |
70.27%
of respondents said Yes |
|
27.03%
of respondents said No |
|
2.7%
of respondents said Not Answering |
If yes, did they pay you back?
|
37.84%
of respondents said Yes |
|
8.1%
of respondents said Partially |
|
24.32%
of respondents said No |
Would you ever (or ever again) lend money
to a family member?
|
59.46%
of respondents said Yes |
|
27.03%
of respondents said No |
"I never lend a large amount of
money, mainly because I don't have a lot. But with family, you just
help each other out, at least that's how it is in my family."
--Keely
"I would only lend money to my
mother because I know she is responsible and would pay me back. I
don't like to lend money to anyone though. It puts both people in a
bad position."
--Anonymous
"No choice. As much as I like
money, they are in worst shape than I am. I'm talking close family
members not cousin or above."
--Jose
"Not that particular family members
but others certainly. They've loaned me money, it seems only proper
to repay the favor if they need it."
--Anonymous
"Don't loan money unless you can do
without it if it is not repaid."
--Anonymous
"Family is family. If a family
member was in a legitimate bind I would help if I could. But if the
bind is caused by constant negligence on their part, example: they
spend unwisely all the time, forget it. they are on their own."
--Shawn
"When you make it known right from
the start that the money is a loan and not a gift and then they
don't make an effort to pay you back, I say don't loan a family
member or friend any more money. I told them next time go get a bank
loan or a loan from a finance co. We did when we needed money."
--Anonymous
"I think it is not a good idea in
general to lend money to a family member if one is looking to be
paid back. I think it is too easy to get into a difficult situation
in the case when the family member cannot pay back. I think if one
does loan money, consider it a gift and if the family member pays
you back, that's fine - if not, forget about the money."
--Anonymous
"I think lending to family should
be done as a bank would--determine the risk, whether you think you
can live without ever again seeing the money. If you can't,
don't--family relationships are not worth ruining over money
issues."
--Lucy
"If they needed it and we had it,
yes I would lend it to them, HOWEVER.... yes, I expect repayment but
rarely get it. Our thoughts on this is NEVER LEND MONEY TO YOUR KIDS
THAT YOU CAN'T AFFORD TO LOSE. They're great kids and are really
struggling; maybe someday........."
--Anonymous
"Our family established a family
emergency fund for any family member who needs money ASAP. They have
a deadline to pay back the money with interest, but the money is
always there to lend."
--Maria
"I think that if you lend money to
a family member or a close friend, you should give it knowing that
you won't get it back. This will save alot of frustration and worry
on both parts. We only reap what we sow. There is nothing wrong with
giving and not receiving, because the reward for giving is so much
greater."
--Josh
"I think lending or borrowing money
from family is tough. It ends up with hurt feelings. My husbands
father, puts interest with it, and that makes it really hard. I
would stay away from lending to family members."
--Crystal
"I treat it as a business
transaction and write up a contract for it, etc. I know it sounds
tough, but this protects both of you and helps the recipient to take
borrowing more seriously."
--Anonymous
Have you ever lent money to a close
friend?
|
59.46%
of respondents said Yes |
|
37.84%
of respondents said No |
If yes, did they pay you back?
|
27.02%
of respondents said Yes |
|
18.91%
of respondents said Partially |
|
13.51%
of respondents said No |
Would you ever (or ever again) lend money
to a close friend?
|
37.84%
of respondents said Yes |
|
32.4%
of respondents said No |
"I would never lend my friends a
large sum of money because that can really cast a cloud over your
relationship. I usually lend the amount of money that I can live
without, just in case it's never returned."
--Keely
"It depends how close they are
and how desperate."
--Jose
"My husband has done this and of
course never saw a penny of it come back."
--Elaine
"To some friends, but definitely
not others!"
--Michelle
"I have not learned my lesson
yet in lending money to friends. I have a few friends who will pay
me back my $20 the following week. I have also lost thousands by
letting friends borrow or put something on my credit card and have
never been paid back for it."
--Anonymous
"You have to think about how
this friend dealt with money in the past."
--Anonymous
"Lending money to friends is a
big no no unless you are well off enough to do so. Your average
family man such as myself couldnt afford to take the chance of
realistically never seeing that money again."
--Shawn
"My friend doesn't always pay
back right away, but when they do, they add a little extra for the
wait."
--Anonymous
"You can pick your friends but
God help you when it comes to your relatives!!!!"
--Anonymous
"Most of our
friends are trustworthy, but we would be selective. The best idea is
to get everything in writing so there are no
misunderstandings."
--Anonymous
"Again, only if I considered it
a gift so that I'm not upset if it's not paid back."
--Amy
"I find that when you lend money
out to friends, it compromises the friendship. So, it's better to
just give them the money and kiss it goodbye!"
--Maria
"Too many hurt
feelings. People are going to be people. We are just human, and I've
learned that you can't trust everyone. I have to know them very
well, and it really all depends on the situation. I won't lend
money, but I'll give it, cause that way, it won't cause any hard
ships."
--Crystal
"Again, treat it like a business
transaction and have a contract written up."
--Anonymous
When you lend money to friends or family
do you expect repayment, or is it better to think of it as a gift?
|
51.35%
of respondents said Gift |
|
43.24%
of respondents said Repayment |
Would you be more likely to lend money to
a family member and/or close friend if a third party were managing the
repayment of the loan? The third party would send out the bills, collect the
money, charge a small fee, and send you the payment?
|
62.16%
of respondents said No |
|
27.03%
of respondents said Don't Know |
|
10.81%
of respondents said Yes |
"I'm not a bank and this would make
me feel like one."
--Anonymous
"It would depend on the amount of
money that I would be lending and the terms of the agreement, like
how many months/years for it to be repaid in."
--Anonymous
"If I'm loaning I'm doing it
personally."
--Anonymous
"If the person is responsible
enough to ask for the loan, they are responsible enough to repay it.
You wouldn't be lending the money if you didn't think they were
responsible enough to pay it back."
--Shawn
"I've loaned money to family /
friends a total of four times. Each and every time, I have been
extremely disappointed by their repayments (or rather, lack
thereof.)"
--Mike
"I think to involve a third
party is asking for trouble. Just determine whether or not this
person deserves your help, and if they should default on the loan,
whether or not you can live with those facts. Those should be the
only considerations, really."
--Lucy
"This seems kind of cold, but if
you have had problems in the past, I can see where it would be
valuable."
--Anonymous
"I have no qualms with a third
party if it's with a friend, but family is family and you need to
help out."
--Maria
"That might help..and kind of
interesting."
--Crystal
Is it fair to charge a reasonable interest fee
when lending money to family member or close friends?
|
48.65%
of respondents said Yes |
|
37.84%
of respondents said No |
|
13.51%
of respondents said Don't Know |
"I would feel funny charging
interest unless it has reached a point where they are very late
paying me back and I needed the money."
--Anonymous
"You should at least equal what
they would be getting if they had it in savings."
--Elaine
"Only on a big loan."
--Michelle
"It depends on the agreement you
make. If it is only a few months and a small amount I don't mind so
I wouldn't charge them interest. If it is more money and time I
would charge interest. After all I am the one lending the money and
probably paying interest on it so why should I have to pay the
interest on money that I don't have in my hands."
--Anonymous
"The going rate in our family is
whatever that money would have made in a savings account. If there's
no money in savings then there's no money available to borrow."
--Anonymous
"If you are going to charge a fee,
don't loan the money."
--Anonymous
"That's the catch, I was always
taught loan from a family member is interest free, or else you would
have just gone to the bank for a loan or credit card."
--Shawn
"JUST PAY BACK THE PRINCIPAL WHEN
YOU BORROW FOR GOSH SAKES!!!"
--Anonymous
"If they don't like it, tell them
to get the loan at a bank at a higher rate."
--Mike
"Sure. It's a loan, isn't it?"
--Lucy
"This is fair, especially for long
terms loans or loans where the repayment plan is not spelled
out."
--Anonymous
"I'm not sure. I've always thought
about it being family, you should treat them a little bit better.
When my husband's dad did that to us, it caused some hard ache with
me. I couldn't believe it. My family has never done that to me. I've
all ways paid back every cent to my family or friends. I believe, do
unto others, what you want them to do unto you."
--Crystal
"In this world you have to pay your
own way. It was expected of you - why not your family member or
close friend!?"
--Anonymous
What rate is a "reasonable" rate
to charge family and friends?
|
24.32%
of respondents said 0% |
|
13.51%
of respondents said 2% |
|
8.1%
of respondents said 4% |
|
21.62%
of respondents said 6% |
|
10.81%
of respondents said 8% |
|
21.62%
of respondents said Don't Know |
Have you ever borrowed money from a family
member?
|
81.08%
of respondents said Yes |
|
16.22%
of respondents said No |
If yes, did you pay them back in full? If
not, why?
|
64.86%
of respondents said Yes |
|
8.1%
of respondents said Partially |
|
5.4%
of respondents said No |
|
21.62%
of respondents said n/a |
"The only people in my family that
I've ever borrowed from are my parents, and that was when I was in
high school and college. It was always called a "loan",
but I think they knew they were never going to see the money again.
I didn't have a job, so I could never pay them back."
--Anonymous
"I borrowed some money from my aunt
and I payed the money back in monthly installments with no interest
charged."
--Anonymous
"I try to only borrow money when
absolutely necessary. I always say the date I will pay them back,
like on Friday when I get my paycheck."
--Anonymous
"The life of the loan is not yet
complete. Still paying it back."
--Shawn
"I have never borrowed from
family. Don't think I ever would, either."
--Lucy
"My father did not want me to
pay him back when I asked to borrow money from him. I tried to
repay, but he wouldn't accept the money from me."
--Maria
Would you ever (or ever again) borrow
money from a family member?
|
51.35%
of respondents said Yes |
|
29.73%
of respondents said No |
|
18.91%
of respondents said Don't Know |
"Now that I have a full-time job
I'd be really hesitant to borrow money from my family. Unless it was
a real emergency, then I would try to make due with what I
had."
--Keely
"If I had nowhere else to turn and
a family member offered, I would borrow money. I know I am
responsible enough to pay it back."
--Anonymous
"Not unless totally
desperate."
--Elaine
"Only in the most desperate of
circumstances. Too me it is a matter of pride."
--Michelle
"Not unless it was life or
death."
--Anonymous
"Its a double edged sword. on
one hand you get a loan interest free, on the other hand they watch
every penny you spend and never let you forget you owe the money. In
a real bind would probably borrow again, but I would look elsewhere
for the money first."
--Shawn
"I paid them back because it is
the right thing to do. I am a trustworthy person, so I cannot even
imagine not paying a family member back when they trusted me."
--Barbara
"Don't think I would--I have
seen what a family loan can do to family. It isn't pretty."
--Lucy
"These are not great amounts,
just gas money; but our integrity demands that we pay the amount
back."
--Anonymous
"I hope we would never need to!!
But if we did, I suppose we would."
--Anonymous
"I can count on my family
members to help me out in a difficult situation. But, at the same
time, I will not add to any of their financial burdens if they are
also in a bind."
--Maria
"I hope I never have to!"
--Angela
"I hope that I wouldn't have to, but if the case ever come up to where I'll need it, I'll ask. I
want to stand on my own two feet."
--Crystal
"If I got between a rock and a
hard place to the point where there's no way around it, I may not
have any choice!"
--Anonymous
Have you ever borrowed money from a close
friend?
|
56.76%
of respondents said No |
|
37.84%
of respondents said Yes |
|
5.4%
of respondents said Not Answering |
If yes, did you pay them back in full? If
not, why?
|
62.16%
of respondents said n/a |
|
37.83%
of respondents said Yes |
"I've never borrowed more than $20
from a friend. I think it puts a strain on the relationship if
friends borrow money. I don't even like to borrow a couple dollars,
but sometimes when we go out to dinner and I don't have exact
change, they will pay and I will pay them back. That is the only
time I would borrow money."
--Anonymous
"Money and friends don't mix well
in my experiences. I only want to borrow money if really necessary
and I always make sure I pay it back ASAP. I don't want someone to
be bothered by the fact that I owe them money and may have forgotten
about it."
--Anonymous
"I think borrowing from friends is
even worse. They have their own issues. Unless they offer to help,
you really shouldn't bother them with your own issues."
--Lucy
"I've never borrowed more than
$5.00. I think when it's a few dollars, it's okay, but never more
than $100."
--Maria
Would you ever (or ever again) borrow
money from a close friend?
|
37.83%
of respondents said Yes |
|
35.14%
of respondents said No |
|
27.03%
of respondents said Don't Know |
"Like I said about my family, but I
would probably have a harder time borrowing money (unless it was
$10) from a friend, who are all in the same financial bracket as I'm
in."
--Keely
"Only if it was less than
$100."
--Anonymous
"Never again will I borrow from a
friend, no matter how desperate I am."
--Anonymous
"It would depend on the situation.
I'm more comfortable borrowing from family than friends."
--Anonymous
"Friendships can be ruined over
something like this. Its not worth it."
--Shawn
"If I absolutely needed to I would
borrow the money. but I would try to find some other way
first."
--Barbara
"I respect my friends too much to
borrow from them."
--Lucy
"I may not have any choice if the
need really did arise."
--Anonymous
Who would you pay back first?
|
72.97%
of respondents said Friends and Family |
|
24.32%
of respondents said Credit Cards |
Who would you rather pay interest charges
to?
|
59.46%
of respondents said Friends and Family |
|
27.03%
of respondents said Banks |
|
13.51%
of respondents said Don't Know |
Would you be more likely to borrow money
from a family member and/or close friend if a third party were managing the
repayment of the loan? The third party would send you the bills, collect the
money, charge a small fee, and send them the payment?
|
67.57%
of respondents said No |
|
18.91%
of respondents said Don't Know |
|
13.51%
of respondents said Yes |
"I'd rather go through a bank to do
this if possible."
--Anonymous
"I do a very good job of keeping
track of the money I borrow from friends/family members. I make sure
I write down each payment that I make and what the date is. I would
rather not pay interest at all if I can help it. I am not sure who I
would rather owe interest to, the bank or a family member. I gave a
family member interest on money I owed her only because I knew that
she was paying a very little amount of interest but why should she
have to pay for it when I am the one borrowing the money. She never
charged me interest on the loan, I just gave her some extra money in
the final payment."
--Anonymous
"The purpose to borrow from family
is to avoid all that."
--Shawn
"I would prefer to work on trust
and good will."
--Barbara
"I don't think it's wise to involve
excess people in family-monetary transactions."
--Lucy
Is it fair to be charged a small interest
fee when borrowing money from family members or close friends?
|
59.46%
of respondents said Yes |
|
24.32%
of respondents said No |
|
16.22%
of respondents said Don't Know |
"It depends on the relationship the
family members have. If it is not a close relationship, I guess
charging interest wouldn't seem so strange."
--Anonymous
"I would never charge interest, no
matter who borrowed it from me."
--Anonymous
"It depends on the amount of
money and how long it will be borrowed for. I don't want to pay
interest on money that I don't have so why should they? So, yes,
depending on the situation, I should be paying the interest on money
I borrowed."
--Anonymous
"It is fair if both parties can
agree on an amount."
--Barbara
"It's a loan. Learn to live with
interest if you borrow."
--Lucy
"I'm not a bank and I'm sure
that if banks knew I was taking their business w/o having to follow
the rules they do, they'd be mad. Nonetheless, I love my family and
friends :o)"
--Angela
"You have to pay interest for
other loans you receive - why not pay it to family or friends for
the loan they gave YOU?!"
--Anonymous
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--End--
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