- LendingTree reports 36% of Americans lost friendships over money issues.
- Sixty-nine percent declined social events due to cost; 39% lied about the reason.
- Matt Schulz advises setting formal loan terms to preserve friendships.
SALT LAKE CITY — When it comes to money and friendship, many of us are struggling, according to new data shared with the KSL Investigators.
LendingTree has found that 36% of Americans have lost a friendship over money. Additionally, 69% have turned down a social event because it was too expensive, though 39% of those people didn't give the person who invited them the real reason why they declined. And nearly half of the people surveyed by LendingTree said they wouldn't loan $500 to even their best friend.
"Anytime friendship and money get involved, it can be a really volatile mix," warned LendingTree's Chief Consumer Financial Analyst Matt Schulz, who says money is always emotional.
And that emotionality doesn't just come from what folks lend. It's also about what they won't share.
About one-third of Americans admitted they lied to friends about being in a better financial situation than they really are. Schulz calls it evidence of people feeling a lot of pressure when it comes to money.
"Some of that's from social media, but some of that's a tale as old as time," explained Schulz. "You want people to think you're doing better than you are."
The key to lending
Now, Schulz won't say you should never help a pal in need, but you've got to take some of the emotion out of it. Make it more formal.
"It's really important to set up expectations," Schulz advised.
When will the loan be paid back, and what happens if it isn't? Sure, it can make for an awkward conversation, but it could spare you from the loss of a treasured friendship in the long run.
"It may get a little bit messy, but not as many people need to lose friendships … if they're willing to communicate a little more openly and honestly," Schulz said.
About one-third of folks who lent money to a friend told LendingTree it would end up being a gift. Their friend never paid them back.
