When Money and Friendship Collide

Last week I was twice witness to someone asking to borrow money from a friend (his hours got cut). And one of my own dearest, closest friends is in dire straits when it comes to money—a formerly high-ranking editor and single mom; she’s been out of fulltime work for months, while her parents just had to short sell their home.

Days like these tend to test relationships as some people around us—or ourselves—get hit by the grey economy worse than others. How do you manage being on the asking-favors end? Or the doing-OK end? Each awkward positions. Here, the best friend etiquette mirrors the best money etiquette: Be a good friend whichever side you’re on. If you find yourself needing to ask for a loan from a friend, you’d be better off heading online to check out various low-interest, short-term loans than possibly sacrificing your friendship should you be unable to pay the loan back. If it’s $20 to tide you over until your paycheck clears, make sure you hand that twenty back as soon as the money hits your account. It may seem like a no-interest, easy loan but there’s a lot more hanging in the balance than your credit score.

On the other side of the fence, when you’re doing OK and a good friend is struggling financially, be sensitive when you get together to socialize. Make it just a drink instead of dinner or hang out at a mid-priced but comfortable and cool locale that takes into consideration both your income levels. And if you offer to pay once in a while (and you can afford it), that’s OK—hopefully your friend will understand and not be embarrassed or defensive. Tell him or her that it’s something you’d hope a friend would do for you one day should you need it. However, if leaning on you to pick up the check gets onerous, keep your social plans as money-free as possible. Make dinner and ask him or her to bring a reasonable bottle of wine (that’d be anything at or under $20 – check out NYTimes.com for a great list of good wines at great prices).

When money and friendship collide, actions can speak much louder than dollars. Sometimes the best thing you can do for a friend when they’re strapped is arrange an introduction. A new gig is worth much more than that $20 for gas. You’d hope for the same.