Debt Management

6 steps to make amends for financial misdeeds


How to craft an apology and repayment plan that works

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6 steps to make amends for financial misdeeds

Making amends, or asking forgiveness from those you have hurt, is an important part of any 12-step recovery program because it forces you to take responsibility for your actions. As such, asking for forgiveness can be the first step to take when you’ve fractured relationships due to money mistakes.

Money can drive a wedge between couples, family members and friends, particularly when one person has loaned money to another or bailed a loved one out financially, only to be left with the bill. For those who have a history of irresponsible financial behavior, making amends can not only open the door for forgiveness and reconciliation, but it can also help them take more control over their financial lives, experts say.

If your past financial behaviors have led to a burned bridge or two, here’s how to begin making things right.

1. Start from within.
It’s natural to feel bad about failing to pay back a loan or running up a loved one’s credit card, but everyone makes mistakes and disappoints others, says Terri Orbuch, a relationship expert and author of “5 Simple Steps to Take Your Marriage from Good to Great.” Before you approach someone seeking forgiveness, you have to forgive yourself.

But that doesn’t mean shrugging off past behavior, says Dr. Jennifer Thomas, a psychologist and co-author of “When Sorry Isn’t Enough: Making Things Right with Those You Love.” Whether you vow not to borrow money from loved ones again or take a money management course, commit to changing the financial behavior that sparked the problem in the first place.

2. Own up to the mistake.
Don’t just say “I’m sorry” or shift the blame to someone or something else. Even if there were extenuating circumstances, such as a job loss or an illness, admit that you were responsible for the financial misdeed. For example, you might say “I’m sorry. It was wrong of me not to pay the loan back in a timely manner.”

Janet Lombardi experienced firsthand the power of a heartfelt apology. When her ex-husband admitted that he was wrong for racking up business debt in her name and borrowing against their house without her knowledge, she found herself willing to forgive him and eventually they were able to become friends again.

“I was relieved because I felt that he understood the depths of my pain,” says Lombardi, who is writing about the experience in a memoir titled “Bankruptcy: A Love Story.” “When somebody apologizes, they take personal responsibility for the fact that they hurt you.”

3. Take steps to right the wrong.
A true apology requires a willingness to change. At this point, you move beyond words to behavior. Can you do something today to erase the financial damage you caused in the past, such as agreeing to pay off a debt with interest?

Documenting a repayment agreement – how much you will pay over a set period of time – can go a long way toward rebuilding trust, says Melinda Opperman, a spokeswoman for, an online nonprofit financial education organization.

4. Create a plan that is realistic.
Don’t bite off more than you can chew. Even if you think you can repay an entire debt in three months, give yourself extra time in case an unexpected emergency keeps you from following through.

“Create a repayment plan that’s going to work. You’re better off making payments that you know you can afford and then deliver more rather than overpromising,” Opperman says.

Also, make sure that the payment schedule is convenient for you. For example, it might be easier to make small payments every other week than to make one large payment a month. If you can, automate the process, and document every payment so there is a paper trail showing that the debt is repaid.

5. Look beyond money.
Sometimes you can’t afford to repay a loan or repair the financial damage you caused. In that case, ask the person if there is another way you can make amends. Consider doing that person a favor or offering a service.

For example, you might baby sit their kids so they can go away for a long weekend or help them paint the garage. Do something they would value. “Paying the money back isn’t the only route to repair the relationship,” Orbuch says.

6. Ask for forgiveness.
You have no control over how your loved one will respond. Yet, it’s important to let them know that their forgiveness – and the relationship – matters to you, Thomas says.

Asking for forgiveness can be as simple as saying, “What I did is inexcusable, but it would mean a lot to me if you could find it in your heart to forgive me,” Thomas suggests.

Money is important, but relationships are priceless. By making amends for past financial mistakes, you honor both.

See related:When paying off debt becomes an addiction, How to say ‘no’ to a loved one’s money requests, How couples can recover from financial infidelity

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