MONEY QUESTION OF THE WEEK

When it comes to money decisions, it can be hard to figure out the right thing to do. Money is about power, emotion, morality, and security, among other things. So in this space, Melissa Leong gathers experts to weigh in on a financial quandary.

This week’ question: Should you loan money to a friend? Fabio Campanella, chartered accountant and partner at Campanella McDonald LLP:

Loaning money to a friend is a great idea if you want to lose that person as a friend Your friend wouldn’t hit you up for money unless he was rejected by his bank If a bank doesn’t trust him to pay back the loan then you may as well kiss that money goodbye

Kelley Keehn, author of nine books on personal finance:

Do it but consider that you may never get that money back again Only you know your friend And you know if you have the kind of friend who is going to buy purses while you’re waiting for your money If they say, ‘No, I’ll pay it back right away I really need help ’ Then say, ‘Can we talk about the parameters of when you’ll pay it back?’ Be prepared for your friendship to end because usually there’s resentment My mom has lent money to friends and there are always hard feelings If you ask your friend for something in writing, it’s a lose-lose proposition; they say ‘Hey! Isn’t this a friendly thing?’ But here is an instance in which an older brother lent the other brother $100,000; within a couple of months, the brother [who received the loan] passed away and the wife said, ‘I knew nothing about it ’

Kerry K. Taylor, creator of the personal finance blog Squawkfox.com and author of 397 Ways to Save Money:

I’ll help a friend build a budget I’ll show them where to cut costs, and I’ll lend a friendly shoulder in times of need; but I won’t lend a pal money Mixing money with friendship is a terrible idea because an unpaid loan can ruin the kinship with emotion and resentment Besides, I’d hate to have to ask for the money back