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Poll: Lending money was a bad idea for more than half of those who did it

In a survey, 59 percent of those who lent money say something went terribly wrong

Summary’s latest poll showed that many who lent money to family and friends either lost the money, damaged their relationship, negatively impacted their credit scores and even got into physical altercations with the borrower.

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You may have heard the saying, “neither a borrower nor a lender be,” from Shakespeare’s play, Hamlet. Wise words, warning against the habit of becoming a personal banker to friends and family.

Results from a new poll by indicate why this is sage advice. With the possibility of not being repaid high, there are sound reasons to hesitate before lending to someone who comes asking to borrow money — or when loaning funds by picking up the check for a group.

How lending money hurts the lender

Among those who have lent money or paid for a group expense with the expectation of being paid back, the survey found that 59 percent had something bad happen. Forty-two percent of the lenders were not repaid so they lost money, and 26 percent experienced a damaged relationship with the borrower.

When you extend yourself to such a degree that your own financial circumstances become harder to manage, you may not be able to meet your payments. As such, 10 percent of the respondents said it resulted in a negative impact on their credit scores. And perhaps most alarming, 9 percent of those surveyed said they had a physical altercation with the borrower.

“I’m not a big fan of lending money to family and friends because of the strong likelihood that something will go wrong,” says Ted Rossman, senior industry analyst at “If you want to do this, don’t lend more than you can afford to lose.”

If you’re a young adult, you have an even higher chance of a bad experience. The survey found that 68 percent of Gen Zer lenders and 66 percent of their millennial counterparts are most likely to have suffered negative consequences as a result of lending money or paying for a group expense. Still, older generations are at risk too. Fifty-eight percent of Gen Xer lenders and 46 percent of boomers say they’ve been burned in the transaction.

What people who lend money do when they’re not repaid

Lenders are in a tough spot when close friends and relatives don’t follow through with their obligations.

The survey found that if people owed them $100 but did not pay the money back as expected, 39 percent would attempt to collect the money. Another 39 percent, though, say they’d allow the debt to go unpaid. A similar survey by Bankrate in 2021 also showed the same dead heat between those who would try to get the money back and those who wouldn’t.

There were a few disparities about collection between the generations. At 51 percent, Gen Zers would most likely take steps to reclaim the money and 43 percent of millennials say they would. Gen Xers and boomers tied at 34 percent.

If you borrowed money from a woman, be more prepared for a collection call. According to the poll, 41 percent of women would attempt to claim the money, as opposed to 37 percent of men who would.

Personal lenders pull back on credit

And then there are regrets, with many survey respondents saying they wouldn’t have lent the money in the first place.

First, there is the economy: 40 percent of all U.S. adults say current economic conditions make them less likely to lend money to a friend or family member. Twenty-six percent are much less likely to provide a loan and 14 percent are somewhat less likely to do so. Only 12 percent said they’re more likely to enter into the arrangement. The other 48 percent said their likelihood to lend money is “about the same” when considering the economy.

Again, though, there is a difference between the sexes: 45 percent of women said they’re less likely to lend because of current economic conditions, compared with just 35 percent of men.

Lending expectations versus reality

The very definition of a loan is that it is a temporary extension of funds. Consequently, 48 percent of U.S. adults have lent money to someone else with the expectation of being paid back.

Not all loans are hard requests for cash, however. Some involve paying for other people’s goods or services, on the condition that they would receive full repayment. Thirty percent of survey respondents covered the cost of a group expense, such as a restaurant meal or event tickets, believing they would be paid back.

Interestingly, the younger you are, the more likely you are to have become a lender by paying for the entire cost of a group expense or lending money. Seventy-three percent of Gen Zers and 70 percent of millennials have lent money this way. In contrast, 57 percent of Gen Xers and 54 percent of boomers have done so.

The amount of money people earn is yet another factor in attitudes about loans and group payments. The likelihood of lending money or paying for a group expense with the expectation of being repaid rises with annual household income:

  • 59 percent among those who earn less than $50,000
  • 62 percent among those who earn between $50,000 and $79,999
  • 69 percent among those who earn between $80,000 and $99,999
  • 70 percent among those who earn $100,000 or more

Bottom line

If you would rather avoid becoming a lender, you have options. You can help the person who comes to you for financial help in other ways, such as reviewing their budget to identify the extra funds. If you have any tasks or small jobs they can do for you, working for the money can be a good alternative.

Or, guide friends and family members to 0% APR intro credit cards. These products usually have a year or even longer with no finance fees on purchases or balance transfers.

Finally, if you do have cash to spare for someone close to you who is in need, rethink your role as banker. “Consider treating the money as a gift to limit the opportunity for hard feelings,” says Rossman.

Shakespeare would approve.

Methodology commissioned YouGov Plc to conduct the survey. All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2,304 adults. Fieldwork was undertaken Sept. 21-23, 2022. The survey was carried out online and meets rigorous quality standards. It employed a non-probability-based sample using both quotas upfront during collection and then a weighting scheme on the back end designed and proven to provide nationally representative results.

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