I loaned my uncle $100, and i will not be getting it back.
This is part one of a two part series on loaning family money. This is the not-so-good part.When it comes to mixing money & family, i'm usually against it. As it turns out though, i can easily be convinced ;)
People say they'll loan out money if they trust they'll get it back, but how do you know who WILL and who WON'T do so? Are your friends and family inherently trustful in this dept? For me, If i'm not sure I can trust you, I'll at least test the waters.
my uncle's situation.
He's in his late 50's, broke, and unfortunately barely living off unemployment, disability, and who knows what else. He's been loaned money dozens and dozens of times (literally) by friends and family, and has rarely paid them back - if ever.
So WHY exactly did i loan him money? Well, when it comes down to it I love him to death. He's always been the "cool" and "fun" uncle, and I REALLY wanted to give him a chance to redeem himself, at least in the eyes of his direct family. Of course, there was no way in hell i was gonna tell my parents this - they've lost thousands and have had enough.
He asked for $400 so he can finally move back to the area and be closer to all of us, and promised to repay it back within 2 months, but ESPECIALLY before our wedding. At the time, that was 3 months away.
Initially i thought Hell to the No! I need that money for the wedding, and the odds of getting it back, at least according to past history, was a good 10% - if that. But you know what? I figured i've never been burnt by him before, and it's probably taken a lot of guts to ask for $ from someone half his age. And he MUST be serious in returning it ESPECIALLY because of the upcoming wedding.
Instead of the full $400, I agreed to $100 and blamed it on my lack of savings. I had to determine an amount that i could easily lose and still be okay with - and $100 was the magic number. We'd still be okay for the wedding, and I had just received a bonus so I could budget it in there fine. I also told him that if he paid it back on time, I will gladly loan him more down the road.
He understood, and was extremely gracious for it, so i dropped that bad boy in the mail hoping to one day see it again. And even more so to raise other's opinion of him. It felt GREAT inside, and I forgot about it...apparently, he did too :(
my benjamin's situation.
It's now been 4 and 1/2 months, the wedding has come and gone, and the money is still "1 paycheck away". And by paycheck, I mean the unemployment check as he hasn't worked for quite some time.
The purpose of this post though isn't to rag on my poor uncle (well okay, it is a little...but only cuz i need to vent somewhere!), but it's really to help put things in perspective when this stuff happens. I'm definitely pissed i'm out the $100, but i have to remember that he needed it more than i did.
In all honesty, I can't really blame anyone but myself. I knew full well that the odds were stacked against me going into this one. And regardless of his intentions or excuses, I at least accomplished my original goal - to give him a chance. It didn't end pretty, but i'm gonna do my best to forgive and forget.
Labels: loaning money
posted by J. Money at
10:31 AM
14 Comments:
That's too bad but at least he'll probably be too embarrassed to ask for more now.
I got into a situation where I had to borrow from my boyfriend but I'm happy to say I'll be paying him back today (as per our agreement). He didn't mind but it has been hanging over me like crazy this whole time!
I loaned a friend $200 a few years ago that it's safe to assume I will never see again either. It happens.
Once I get my Emergency Fund started hopefully I will never ever have to be a borrower again.
$100 is pretty cheap for a relative. Now if he ever asks again, you can ask "where's my last $100?".
I'd probably give any direct family member or close friend $100 without even thinking. If they don't value our relationship enough to pay it back... well, now I know.
I don't even look at it as "loaning" money, I think of it as a donations because I know I won't get it back.
oh yeah, i hate owing people money. i've needed to borrow in the past, but going forward i'd prob. just slap it on the c/c depending on the situation..
great job staying on top of it Sallie's Niece!
jonathan - can i borrow $100? haha..
I love the tear drop! :)Ok I would do the same thing if I were you by lending money to him. There are things in life you can not acquire with money. I am sure he appreciates your help that's the most important.
Seriously - nice graphic! Love that.
Anyway, don't be too hard on yourself. You tried to help, it was a small amount (you aren't getting it back) -- put the dustbunny under the rug & move on. (Never lending to him again, BTW.)
Good luck!
My brother owes me $80. With much persistence I received $30 after 6 months. I recently found out he owes our brother close to a grand. Geez!
Sorry - my brother is WORSE - and he is employed with a wife and a combined income in excess of $150,000 p/year, but they can't manage a budget or save $$.
Loan 1 - 16 Years Ago - From my parents to pay for him to get his BS at University of San Francisco, an expensive private school in SF. My parents were retired and on a fixed income and paid for two years (four semesters) of his education. He never repaid the loan.
Loan 2 - 12 Years Ago - From my parents - a significant loan so they could purchase a new house in a new development in the SF Bay Area. I've known about the loan, but the rest of my brothers/sisters didn't. When my mom died four months ago we found the letter outlining it was a zero interest loan that had not been repaid.
This explains why my Dad was so disappointed two years ago when he died... my brother bought the house just as the market exploded, rather than pay my parents back, my brother would refi or get a HELOC, pull equity out of the house to finance a life they couldn't afford (sail boat, new cars, expensive vacations).
The purchase price of the house was $198,000. At the height of the market, the home's value shot up to over $750,00. Now it is down to $545,000. Of course, they took so much equity out, they are almost "upside down" --
According to the letter with the trust documents, it is up to my sister to determine if the "loan" should be repaid from my brother's share of the money left in my parents' estate. My sister spoke with my brother as a "character" experiment. He failed - he didn't say "deduct the funds from my share and distribute them tothe rest of the ki.
Loan 3 is actually THEFT from my accounts. Five years ago I was diagnosed with tumors in my abdomen and the prognosis wasn't encouraging. In case I was incapacitated and unable to write checks and pay my bills my family and I decided adding my brother to my accounts would be wise so if necessary he could step in and take care of things.
It was scary and it took me a long time to recover. My brother banks at the same place and has a habit of writing bad checks - everytime he writes a bad check, the bank "sweeps" my account to cover his bad check. He has never taken responsibility for his poor financial management skills - he treats this as the banks fault (for taking the money out of the account) or my fault (for not removing his name from the account - which I can't do legally because when we added him, he became a "legal" owner.
I think you did the right thing if you could truly be ok with the possibility that he wouldn't pay you back. It seemed like it bothered you when history said that he most likely wouldn't. Your heart was in the right place and that leads to doing charitable things. There was never any insurance your uncle would do the right thing. I don't think there's a right or wrong answer. I think it's whatever you can live with.
Jerry
www.leads4insurance.com
MP - HOLY CRAP, first off i'm sorry to hear about your parents passing away and your health stuff :( sad!
But yes, your brother is def. on the wrong path - i honestly, sincerely feel really bad for him. i can see messing up once or twice, but has has lost all respect for you guys and is spiraling down fast.
Seriously, i don't know how you handle it. Could you switch banks one that one account so it at least prevents him from taking advantages? Or does HE know have to give permission to do that?
sucky situation, i'm really sorry to hear that. Thanks GOODNESS the rest of your family is on track :) Good luck with everything!!!
And thx everyone else for the input, it always helps.
So really you gave your uncle a $100 gift and at the time, you knew it was a gift since it wasn't the original $400 loan he asked for.
Next time I see you, I am going to sell you an expensive $100 banana. We'll call it a gift. ;-)
I've discovered something interesting about my family...apparently, certain family members don't actually think that inter-family loans are meant to be repaid. My mother actually said as much one night during a conversation about several family members. I'm not sure if that makes me feel better about the unpaid loans, but it certainly does help me to know that they are not loans, they're gifts. Oddly, other family members think as I do, that loans are actually loans that are meant to be repaid. Interesting how people can have such different views!
Cool. That must mean they are willing to give you some money back as a gift then! Seriously, you are right, they are wrong. Loans are agreements that have to be repaid. Failure to repay damages the lendee's self esteem and self regard as well as damaging the relationship between the lender and the lendee. It's a lose-lose scenario.
That's why I always make out a loan agreement with a payment schedule and have it signed by both parties and a witness, otherwise you really can't be sure what you are going to get when extend a loan to someone. Make clear that it is a financial agreement, beyond being a family assistance thing. You expect your money back. Ask specific questions about whether and how they are going to be able to meet the payback agreement. If you do that it will become clear to them that you are not considering this a *blowoff* loan. When I loan money I will at least draft a simple loan agreement even for a $50 loan. (not less). The act of signing an agreement will put the loan into a different frame because the 'loans that are gifts' would never have such accessories.
BugBear - i hear ya loud and clear, and will def. keep this in mind for all future loans! it's now been a good 9 months since i've loaned my uncle the money, but i know full well it wont' be coming back...crazy uncle.
@MapGirl - silly girl :) you know i'd probably fall for that too, esp. if you catch me during one of my cravings!
@Anonymous - haha, at least you know which to stay away from now! would be nice to have a chart of all this for the next time :) you're right though, people's views are so different sometimes.
Post a Comment
Links to this post:
Create a Link
<< Back to Budgetsaresexy.com