Money Matters – How To Avoid Borrowing Money from Loved Ones

Money Matters – How To Avoid Borrowing Money from Loved Ones

“Neither a borrower, nor a lender be; for loan oft loses both itself and friend,” said Shakespeare and right he was. Money is one of those things powerful enough to shatter relationships. That is why most of the people deem borrowing money from a friend as a serious taboo. Yet, there are situations when one is left with no other option. For instance, Australian students usually find it difficult to get their loans approved by banks and lending institutions.

Banks may require a strong credit history along with a valid proof of income along with other formalities. Most Australian students don’t have a previous credit history and their income isn’t even sufficient to satisfy banks. Yet, financial trouble may strike unexpectedly, and in such situations, you think of no one but people close to you.

Unfortunately, money, whether you lend it or borrow it, may put both of you in an uncomfortable situation. It, more than often, ends the relationship on a sad note. So, it is always best to avoid such dealings with friends and loved ones. Even when you are unable to see any other way, here are a few tips to avoid the forbidden route.

Manage Your Own Budget

It is better to save than to borrow. With a little tweaking of your spending habits, you can actually save a reasonable amount of money every month. So saving money is the best way to become self-sufficient.  Start with smaller changes. Cut down on junk food, lower your electricity usage, shop with discount cards, drive less and look for frugal options even if they save you a mere dollar.

Go For Investment Instead

If you want money to start a new business, ask not for a loan but for an investment. Make them your partners and share your profits with them. This way, you won’t have to repay the loan. Even if you suffer a loss, your friend will be able to understand the situation in a better manner. In short, an investment will allow you both to maintain a professional attitude as well as a friendly relation regardless of what happens to that money.

Ask for a Favour

If it is not about a business investment, there is another way to ask for money without making it a loan. You can ask for a favour, but, in return of a favour. For Australian students, it is easy to cut such a deal. You can run errands for them. You can clean up their room or press their clothes for one or two months. Or if you are good at a subject, you can tutor them for free.  Once again, it will save you the trouble of returning the amount.

Check for Student Loans

There are a few institutes which allow special loans for Australian students studying in colleges or universities. While most of these loans cover academic expenses only, there are a few that might cater to your needs as well. The best thing about student loans is that they have more flexible terms and longer repayment times.

 

 

Student-Finance.com.au is not a credit provider and does not act as a intermediary between any credit providers. This website does not provide Financial Product Advice or deal in the sale of any financial product. If you require this service it is recommended to seek the help of a professional. You should consider your own specific circumstances before making any Financial decision.