Now here’s a loaded question, “should you lend money to your boyfriend?”
Uhh, girl, I’ve been there and it’s awkward. But, there are things you can do to help your partner financially and ensure the relationship remains intact.
Is it ever okay to lend your partner money?
Relationships are complicated; throw a financial transaction into the mix and it takes it to a whole new level.
While we all go into a relationship with feelings of lust and great intentions, sometimes feelings change and, well…things get complicated. Money is one of the main reasons that couples fight and it’s one of the leading causes of divorce. So, while you might be inclined to loan your sweetheart some money right now, you also have to think about the future and consider how you will feel if things go south and you’re out a big chunk of money.
Maybe he has credit card debt or perhaps a lender denied him for a personal loan due to his credit score. That makes him a risk for loaning money and leaves him few options for borrowing.
While you wrestle with whether or not you should lend your partner money, consider how you would answer the following questions — they may give you some additional insight as to what is best for you.
- Why does he need the loan? Are they bad with money or did something happen that was outside of their control?
- Would you be okay walking away from the sum of money if you never get paid back?
- Is this something you will resent your partner for in the future?
- Can you afford to loan your partner the money or are you jeopardizing your own financial situation?
- What would you advise a friend or family member to do if they were debating the same question?
Money changes relationships. If you need proof, check out the divorce rate and remember that money is one of the leading causes.
Why you should not lend money to your boyfriend
Here’s where I play the role of big sister, or dad, or best friend and I tell you why I think that lending your boyfriend is a bad idea (at least most of the time).
Lending money to friends always comes with major risks. The person who wants a loan may not respect your hard-earned money. He may not think borrowing money is that big a deal and the borrower may not be that concerned with repayment. You're in love and you're the bank. To borrow from your bank account may be easy for your partner but it's something you should really think about before even considering.
It can compromise your financial position
If you are a multi-millionaire and you want to lend your boyfriend money, you’ll probably be fine. However, for most of us non-millionaires, our money is usually accounted for. With nearly 80% of American workers living paycheck to paycheck, many people are struggling just to pay their bills. So, before you write a check to your boyfriend consider if you can afford it. Will you be left in a bad financial situation if you don’t get paid back? Will your credit suffer? Will it sidetrack one of the financial goals that you’ve been working toward, like buying a new home?
And, if you have maxed out your credit cards or are in some sort of debt yourself then tell him “No.” You can’t risk your own financial future. If he’s the one, he’ll understand.
It can enable your partner's bad money habits
If your boyfriend is always in a state of financial turmoil then you lending him money isn’t going to solve his problem. In fact, you lending him money might perpetuate the problem. If your boyfriend always seems to be short of cash or struggling to pay his bills this should raise some red flags for your relationship long term.
Do you want to be with someone who can’t manage their money? I know love is supposed to conquer all but let’s be real here. I’m not saying you should dump him because he’s bad with money, but you definitely need to start having conversations to see if you can get on the same financial page.
It can compromise your relationship
As I already said, money changes things. It might seem like a good idea to lend your boyfriend money now but just wait. What if he starts going out and spending on things that you deem to be frivolous? Will you have something to say? Will you feel slighted? Will you lord this over him?
If you answered yes to any of these and you value your relationship and want to see it thrive, don’t lend your boyfriend the money. Instead, offer to help him find other ways of obtaining the money.
Alternatives to lending money to your boyfriend
If you're in a relationship and your partner asks you to help him out financially, there are things you can do to assist without writing a check.
Help him find financial advice
If your partner is someone who struggles with money, assist him in finding help. This can be in the form of a financial counselor or non-for profit credit counseling. While this might not solve the immediate problem of needing a specific amount of money, this will help him out in the long term when it comes to breaking bad money habits and getting to the root of his money issues.
Personal finance isn't something most people understand. Many people run into problems with credit card debt that forces them to borrow money, whether that be from a friend, a lender, or any other source loaning money.
Gift him the money
If you feel uncomfortable lending your boyfriend money, you could always just gift him the money. Giving the money as a gift removes the expectation of being paid back and can prevent the breakdown of your relationship based on money.
Help him get his finances on track
If you are financially savvy and good at managing your money perhaps you can impart some of your wisdom. Help your boyfriend create a budget so he has a better idea of his overall financial situation. If he struggles with remembering to pay his bills on time you can be the one who reminds him (or just help him set up reminders in his calendar). And, when it comes to getting the money he needs, assist him in finding a reasonable loan. Help him to research his options and avoid things like high-interest payday loans.
Talk about it
Be the person he can go to talk about money. Have regular money conversations and check in on each other. For many people talking about money can be super awkward and uncomfortable but, if this is a person that you see a long-term future with, it's so important to get on the same financial page. The best way to do this is through open and regular conversations.
Safe ways to lend money to your boyfriend
Of course, if you decide that you can and want to help your boyfriend out financially then there are steps you can take to ensure things are fair.
Only lend what you can afford
I can’t stress this enough — DO NOT put your financial situation in jeopardy for someone else. If you can’t afford to take the loss then you can't afford to loan the money.
Discuss the details
If you decide to loan your significant other money make sure you are both on the same page. Work through all of the details. How much will you loan them, when do you expect to be paid back, will you charge interest? How do you want to be paid back? What happens if they are late paying you back?
You need to have a loan agreement in place. That's literally a signed contract between the two of you — a promissory note of sorts — that lays out the terms of your arrangement.
This conversation might feel super awkward but it’s totally necessary. And, if your partner feels comfortable enough asking you to borrow money then they should be okay discussing the terms.
Get it in writing
While a verbal agreement can be legally binding, it’s better for both of you if you can just get it in writing. The most important elements to include in your written agreement are:
- The amount you are lending
- If you are charging interest rate and how much
- How they will pay you back. Will it be in monthly installments or a lump sum payment?
- What will happen if they miss a payment? Will you charge an additional cost, pursue legal action, etc.?
If you need help writing this up you can find various templates online. Here’s one example.
Do what makes you feel comfortable
Ultimately the choice is yours when it comes to whether or not you should loan your boyfriend money, but put some thought into it. If this is the third, fourth, or fifth time they’ve asked you for money and it’s becoming a pattern, you might be enabling a bad habit and perhaps your partner needs additional help. If this is a one-time deal and you can afford to help your partner out, then that’s your call. Just remember, there is a chance that you might not see that money again so make sure you aren’t putting your own finances in jeopardy.
–By Jessica Martel