Money can make things awkward, especially when friends are involved. After all, most of us aren't just given a million dollars for no reason. So what happens you when you casually pick up the tab for a meal or lend a good amount of money to a pal who is in a desperate situation ... and they haven’t paid you back?
Whether it’s just a few bucks or a couple of thousand dollars, use these four tips below to get your friends to pay you back when they owe you.
1. Check for an Update
Perhaps the person you gave some of your hard-earned cash to needed it for a very important and specific reason. One way you can check up on their payback status is by asking them how that situation is.
“Call them at a reasonable time and find out how things are going on that "specific" reason for borrowing,” says Ogechi Igbokwe, Founder of OneSavvyDollar. “This shows that you care but more importantly serves as a gentle reminder of how they got the funds in the first place. Checking in on them makes for a less awkward conversation and might even prompt your friend to initiate the repayment talk.”
2. Be a Little Flexible
If you are worried that you’ll never see that money deposited back into your account ever again, ask your friend to start paying you back in installments.
“You can ask your friend to get on a monthly plan where they pay back $100 every month instead of $700 all at once,” says Igbokwe. “Sure it's going to take longer to get your money especially since you lent it at once. However, we all know the best way to get anything done is to break it down into bite-size pieces.”
3. Put Things in Writing
Before you hand a friend a large sum of money, put together an agreement that both of you can sign.
“If you are lending large amount of money — always put it in writing,” says David Rae, a Los Angeles Certified Financial Planner with DRM Wealth Management. “Lay out when you expect to paid back, and how much you expect to be paid back. That way there is no confusion, and you shouldn’t feel like you are nagging if they aren’t being a good friend and paying you back when they said they would.”
4. Be Specific and Ask for It On-the-Spot
Sometimes you might pay for something for a friend without them even realizing you want money back.
“If you want to get your friend to pay you back, make sure to communicate when lending them the money,” says Rae. “If you say I got dinner, they are going to think that you are paying. Tell them I’ll cover it and send you a payment request. You can uses apps like Venmo to send the gentle reminders that they still owe you money.”
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