Money decision lab

A friend asks to borrow money

A close friend asks to borrow an amount that would take you about two months to save. They promise to pay it back in a few months.

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A close friend asks to borrow an amount that would take you about two months to save. They promise to pay it back in a few months. How would you think it through?

What matters here

• What you can afford to lose
• The friendship
• Their situation
• Your own buffer
• How repayment would work
• Alternatives to a loan

Ways people reason about it

None of these is marked correct.

Lend only what you could give

Many people lend to friends only the amount they could live with never seeing again, because a loan that goes unpaid can hurt both the money and the friendship.

Fits when: You value the friendship and can absorb a loss of that size.

Lend with clear terms

Agreeing on amounts and dates, even informally in writing, can make things easier for both sides and reduces misunderstanding.

Fits when: The amount matters to you and you both prefer clarity.

Help in another way

Sometimes the most useful help is not money: time, a contact, help finding support, or a smaller gift.

Fits when: Lending would strain your own essentials.

Say no kindly

A clear, kind no can protect both your finances and the friendship better than a reluctant yes.

Fits when: You cannot afford it, or past loans went unpaid.

What would change the answer

• Your own emergency savings.
• How the friend has handled money before.
• Whether the need is urgent and serious.
• Whether you would resent it if it were not repaid.