Handling Money and Friends

Money and friends don't always mix well.  Money can be a touchy subject because each of us has a varied perception of what it means and how to handle it.

And, as humans often do, we tend to judge others who don't share our views on spending, saving, and earning money.  One way etiquette helps is that it appeals to your better nature.  You learn to exercise restraint when facing sensitive issues.

Self-esteem and respect for others are critical concerns when it comes to money and friends.

A Loan or a Gift?

We all like to go out of the way to support people we're close to, but lending money can be risky. 

When a friend approaches you with a need for money, his feelings are considered up front and first.  The larger the request, the more sensitive the situation. 

Acknowledging that the request wouldn't be made if it weren't important is one way to let your friend know you want to help, even if you don’t end up loaning money.

If you are able and decide to help by loaning, there is technology you can use to set up a repayment schedule and issue payments.  These “digital wallets” let you make and share payments with a friend, and serve as friendly reminders and easy conversation starters if things get off-schedule. 

Regardless, arranging a schedule and method for pay back is important to keep things transparent and create a mutual understanding of expectations.

However, you may have people in your life with whom you are close, but know that lending them money is a lost cause. 

This doesn't mean you shouldn't help them if a need arises.  But it may be easier, in your mind, to consider any money you give them as a gift. 

Odds are, they may offer to repay you.  But holding the perception of this loan as a gift can help you keep resentment at bay. 

Your Rules Around Money and Friends

Besides the sensitive issue of loaning money to friends, the question comes down to, “How do you create good etiquette habits around money?” 

Etiquette involves what you do when you are with others.   Ethics involves what you do as an individual.  Appropriate money management requires you to consider both. 

  • Know your budget and how it will determine your short- and long-term financial well-being.
  • Use your budget to keep things on an even keel when balancing money and friends.
  • Always repay what you owe.
  • Give careful consideration to evenings out, trips, and other activities for which you can't pay your own way.
  • When your group of friends decides to go somewhere together, make sure everyone is in agreement on who is paying and how.
  • Let your friends know your feelings on spending limits when going out so you don't find yourself with a sky-high bar bill to contend with!

Sensitive Money Moments

When are sensitive money moments likely to arise? 

Splitting the Check

  • Your ordered a cocktail and grilled lobster while your friend had water and a Cobb salad.  Adjustments to splitting evenly require mindfulness and fairness.
  • Agree ahead of time to the tip amount and how the check will be paid.


  • Who invited whom?  The general rule is that the person who invited picks up the tab.
  • Though sensitivity to gender issues is important, if you date regularly, it's perfectly fine to discuss cost-sharing.


  • If you're in charge of a group gift to someone and aren't sure about a reasonable amount to spend, take a private poll of those who will be chipping on what range they find acceptable.  Pool the knowledge gained and come up with a just-right amount.
  • If gift exchanges are the norm at holidays for your friends or family, discuss price ceilings.

Office or Crowd Funding Charity Initiatives

  • If you are organizing the initiative, only ask once and avoid being pushy.  It isn't appropriate to require explanations of those who choose not to give.
  • Ask for contributions individually, not to a group of people.  Avoid putting people on the spot.
  • If you choose not to give, you do not owe an apology or explanation.
  • If a coworker announces she is giving her birthday up for a chosen charity and you weren't planning on a gift, it is fine to wish her a happy birthday privately.

Lending Personal Items

  • Before you lend something, make sure you're prepared to deal with the loss of it. 
  • If you borrow something, are you prepared to repair or replace what might be damaged?

Lending Professional Advice or Assistance

  • If a friend offers a discount on a professional service, be sure you have a way to even the scorecard.
  • If your professional friend is out of the office and you have a question, be sure to ask the "Is this billable?" territory question.

When a Friend Won't Ask for Help

  • If pride keeps a friend from accepting help, investigate how you can help anonymously.  There are ways to give without revealing the source.
  • Initiate an empathetic conversation with your friend on how he would like your help, as you insist on it.  Sometimes hearing "I've been there, too" will break down the wall.

Summing it Up

For some people, money is a source of anxiety and fear.  For others, it is directly tied to their self-worth. 

Because of its various meanings and personal nature, conversations about money require sensitivity.

It's a good idea to give considerable thought to your relationship with money in regards to your relationship with people.  Knowing where you stand, and creating personal rules to abide by, will help you keep your money and your friends.

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