Should I Lend to Friends and Family?

MONEY AND RELATIONSHIPS are a tricky combination. When a family member or close friend asks to borrow money, it can put you in a difficult spot. On the one hand, you want to help someone you care about, but on the other, lending money can easily lead to strained relationships or hurt feelings. Proverbs 22:7 reminds us, “the borrower is the slave of the lender,” highlighting the potential for tension and a change in the nature of the relationship. So, is lending to loved ones ever a good idea, or are there better ways to offer support without risking the relationship?

There are three possible outcomes, but only one is ideal:

1. If you don’t lend the money, the other person could be upset.
2. If you lend the money and they don’t repay it, you might feel upset.
3. The borrower repays you, and everyone is happy—but this outcome is rare if they’re already struggling financially.  

What does the Bible say about lending? The Bible encourages us to help those in need, even lending if necessary. Deuteronomy 15:8 urges us to “lend him sufficient for his need.” Jesus says in Matthew 5:42, “Give to the one who begs from you, and do not refuse the one who would borrow from you.”

1 Timothy 5:8 might even make you think you should always lend to family when it says:

“But if anyone does not provide for his relatives, and especially for members of his household, he has denied the faith and is worse than an unbeliever.”

However, Scripture reminds us to keep two things in mind:

1. There must be a genuine need. (Ephesians 4:28)
2. Lending should help, not enable poor financial choices. (2 Thessalonians 3:10)   Yes, while we are called to be generous and compassionate, we are also called to be wise stewards of our resources. Supporting someone who refuses to contribute or manage their resources wisely may not always be the best way to help.

How to Discern a Real Need Before opening your checkbook, evaluate the situation. Lending money can sometimes be an easy way out, and the borrower may not fully appreciate it. Proverbs 21:20 adds, “Precious treasure and oil are in a wise man’s dwelling, but a foolish man devours it.”

Here are a few important questions to ask:

• Can they realistically repay the loan? If they don’t have the means, promises will fall short.
• Can you afford to lose the money? If the loan jeopardizes your financial stability, it’s better not to lend.
• Could you help in other ways? For example, if they need money for car repairs, could you offer rides until they save up?
• Can you make it a gift? Turning a loan into a gift might protect the relationship, but only if you can afford it, and it won’t encourage more financial mismanagement.  

If You Decide to Lend

If you choose to lend, it’s wise to create a written agreement that would outline the loan terms—amount, repayment schedule, interest (if applicable), and any collateral. A written agreement can prevent misunderstandings and keep expectations clear.

In the end, lending money to family or friends is more than a financial decision—it’s a relational one. While Scripture encourages generosity, it also calls for wisdom and discernment. Before you lend, take the time to assess the situation, weigh the risks, and consider alternative ways to help.

If you choose to lend, put the relationship above the money. After all, no amount of money is worth damaging a relationship that God has placed in your life. When done with prayer and wisdom, your decision—whether to lend or not—can reflect God’s love and faithfulness, bringing peace to both your heart and the relationship.

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This article was published in our Faithful Steward magazine, a quarterly publication filled with encouraging stories, biblical teaching, and practical tools to help you grow as a wise and joyful giver. If you'd like to begin receiving Faithful Steward, consider becoming a FaithFi partner.