Spending time with friends is rewarding and fun, but things can become tricky when money is involved. Almost everyone has that friend who conveniently heads to the restroom when the check arrives at a group dinner; or regularly "forgets" his or her wallet on a coffee run claiming they'll pick it up the next time; not to mention the friend who never chipped in for that hotel room you covered over a bachelorette weekend. In fact, nearly one in four Americans admit they have borrowed money from a friend or family member and never paid them back, according to a recent online survey.
It's no surprise that owing money or being owed can put a serious strain on a relationship — sadly, more than 50 percent of Americans report they have seen a friendship end over money owed. So how do you approach a friend or loved one who won't pay you back before your relationship goes haywire? Or initiate a conversation with a family member you've had a falling-out with over money you still owe?
"When money has become an issue in one of your relationships, don't wait to address it, even if it feels uncomfortable," said Dr. Melanie Ross Mills, relationship and friendship expert, and licensed temperament therapist. "A little compassion and tactful communication can go a long way — and, in this day and age, there are technologies that offer fast and easy ways to send and receive money, making the payment part painless."
To help navigate awkward financial situations with your friends in a manner that doesn't result in the termination of a friendship, here are three tips to keep in mind.
1. Plan ahead to avoid conflict
Always consider the unique relationship you and your loved ones have with money. While you may be someone who budgets for everything down to dish soap and paper towels, your friend may spend more freely. Think about whether you prefer to split shared expenses right down the middle, itemize the check or alternate who pays. As you coordinate a get-together, consider asking your friend how he or she prefers to handle the expenses so you can come to an agreement before the check arrives and the awkwardness strikes.
2. Keep the lines of communication open
If you find yourself in a situation where you've covered the cost of a friend's concert ticket, or you need to repay a roommate who spotted you 50 bucks, don't be afraid to talk about it. Even if you can't pay your friend back right away, don't wait to let them know when you plan to return the funds. Open, honest communication is always better than ignoring the problem or hoping someone forgets what you owe. Likewise, if you're waiting for someone to pay you back, it's OK to reach out with a gentle reminder. If you keep things cordial — not demanding — and remain sensitive to your loved one's circumstances, you can come to a mutually agreeable solution.
3. Take advantage of P2P technologies
With the proliferation of person-to-person payments (P2P) that allow consumers to send money to others via their mobile device, it's never been easier to settle up with a friend in real-time. The Bank of America(R) mobile app is a simple way to send, request and receive money from friends and family, no matter where they bank. So even when you or your loved ones aren't carrying cards or cash, it's easy to cover your portion of shared expenses on the spot.
Findings are from an online survey of 1,000 nationally representative panelists ages 18+ administered in July 2017.
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