If you are one of those “lucky” few whose friends, relatives, acquaintances, milkman, newspaper hawker would ask for money when in so-called “emergency”, welcome to the world of Victim Lender’s world. Humans are social creatures and we must help each other; well this is what we are taught since our childhood. Many of us take this advice literally and go through a traumatic time. I have been a big time saver all my life and somehow my so called friends always knew I had some money. I have lent Rs 2 from my pocket money of Rs 10 to Rs 1 lac when I started earning. Forget about friends and relatives; people like chaiwallah, news paper hawkers have asked for money and you know what; I was the chosen one! I am damn sure there are many like me around. There is something written on our face that people chose us to borrow money from.
Helping someone needy is our social and ethical obligation but it hurts a lot when people take advantage of our generosity which actually is our stupidity for them. They lie to about the reason, miss and delay the return deadlines, partial payment that too in fraction and what not. Worst happens when they accuse you for bothering them when you ask your money back. Problem list is huge but I am trying to summarize them all as 3 major problems with lending money:
- Delay in returning money with many cases of partial or total loss of money
- Sour relationship with the borrower
- My own inability to say “No”
How do we have money to lend?
In present times, we have so many things to spend on that even six figure salary at times is not enough to maintain decent lifestyle. Still we manage to save some extra money but how? The list can run very long but trying to sum them up in following 4 points about How do we have money to lend?
- We are savers, intentional or forced, we somehow manage to save
- We are have some liabilities or plans for future and discipline to save for it
- We don’t like borrowing money
- We believe in living within one’s means
Why do people borrow money?
Wondering why I didn’t write; “Why don’t they have money?” Well not everyone borrows money when they runs out of it. There are people who borrow money even when they already have it. Wait for a while. Here are top 4 reasons Why do people borrow money?
- People borrow because they neither plan for unforeseen future nor did they save
- Incidental expenses beyond one’s capacity
- It’s in their habit
- They are too shrewd a planner that they invest their money to get returns and for small contingencies, borrow money which comes interest free!
The million dollar question arises; “What should we do when someone asks for money and we have it? My biggest problem is I can’t say No!
I perfectly understand your situation, most of us lend money even to those who won’t even return back the money, just because we can’t say No. They ask for money because they know it better than you. They come prepared with sobbing story why they need money and commitment on how they are going to return every single penny as soon as they get next pay check.
It’s your very own inability to say NO to these cons that you and your dependents suffer. But not anymore! Here is how you can overcome this weakness. You need to be prepared well in advance who you would lend money. Here are the 5 Rules To Protect Your Money From Borrowers?
Rule # 1: I lent money to only those who maintain my kind of lifestyle. People living beyond their means or lavish lifestyle don’t deserve my help.
Rule # 2: What this money is going to be spent on? If its for the honeymoon, car or other luxuries, it’s a NO. If there is any accident and medical emergency, its a YES.
Rule # 3: Cap the maximum amount to 10% of monthly income or total savings whichever is low
Rule # 4: Borrower must share the plan and timeline for repayment
Rule # 5: Keep on updating the Blacklist people who you won’t lend come what may
Try thinking about the people around you who have been asking money or may ask money; take a mental note on how many of them would qualify these conditions. If I am not wrong, you can count people on fingers and in best case, in just one finger! Now all you have to do is to say NO to all those who don’t fall in your trusted people list. The simplest excuse to saying no is “I don’t have money to lend”. I know they would insist and blackmail with their story, this is when you suggest them to take loan from bank, employer etc. It might sound too simple but has worked with me.
First time it’s going to be tough but the beauty here is when you successfully put down request of one blacklisted fellow, your self confidence will increase and you will feel better. And when you are done saying NO to 3 people or so, everyone else around would know and you probably would not be bothered again by these blacklisted fellows.
These suggestions are based on my personal experiences and I hope they work for you. Please use your own wisdom and improvise. Do share your experiences with us and other readers.