Not having realistic expectations for yourself
You need to keep in mind that we’re in the second year of a global pandemic and things are not easy for anyone. In light of the current economic situation, you can’t know for sure how long it will take the borrower to give you back the loan, warns Ethan Taub, founder and CEO of the bill management platform Billry.
For the moment, there’s no end date for the pandemic, as much we would love to see it over and done. With further lockdowns on the horizon and social distancing rules, things are not looking bright for the economy. With all that in mind, you need to realistic expectations about your financial situation.
Being caught off-guard by your own financial emergencies
It’s pretty clear by now that we are living in uncertain and unpredictable times. You might think you are in solid financial shape but the pandemic’s effect on the economy is far from being over. This means taking money out of your own nest egg and giving it to someone else may not be the smartest move right now, warns Taub.
“You cannot guarantee your own financial safety, so needing that money back could become quite desperate, quite quickly,” says Taub. You might have to pressure the borrower into giving your money back faster or resent them for creating a hole in your budget. Either way, this sort of situation could affect your relationship in irreparable ways.
See also 9 Ways to Be Financially Prepared for a Future COVID-19 Lockdown.
