4 Ways You Can Set Clear Financial Boundaries with Friends & Family

By Sara


Last Updated: May 23, 2023


Setting financial boundaries in your relationship is vital to ensure your own financial security.

Without set boundaries, your relationships could suffer. To avoid this happening, you need to find how to set these financial boundaries while still being supportive. 

Whether it's with friends or family, talk around money can be really tricky. You don't want to offend people, but often, finances can come between us - whether we set boundaries or not. Whole we can't always avoid this, we can be 100% clear on what we will or won't do when it comes to our money. 

Here's how you can set some clear financial boundaries.



What are relationship boundaries with money?

Having boundaries with your close friends and family is an important way to maintain a good relationship.

Setting boundaries around money will allow you to avoid awkward situations and keep your relationships. Without having clear financial boundaries, you could risk your own friendships and your finances. 


How do you set financial boundaries with friends?

There are four ways to set financial boundaries with your friends.  


1. Understanding your own financial limits.

If you are fully aware of your own financial situation, you will know if you can help out a friend or not.

You may be able to pay for coffees once in a while, but you also know you can't help them with a large financial loan. On the other hand, if you aren't aware of your own financial limits, you may think you can help your friends financially. 


2. Communicating your boundaries: When and how to bring it up.

Being able to tell your friends about your boundaries is crucial.

You need to be clear and polite if you are in this situation. Try to bring this up as early as possible, but when appropriate.

For example: Your friend asks for you to buy them a concert ticket.

You can clearly ask them for their Venmo to request you if they ask you to wait until they can pay you in cash. Now is your opportunity to bring up your financial boundaries. You can explain that you need the Venmo request to pay off your credit card bill because you don't carry a balance. 


3. Maintaining financial boundaries: Dealing with pressure and guilt.

You will always have to be aware of how you maintain your boundaries.

You may feel pressure or guilt to help a friend out. Don't allow outside pressures to impact your finances, especially if you are struggling with money yourself. 


4. Considerations for specific situations: lending money, splitting bills, etc.

There will be times during a friendship when you will be asked for financial assistance.

If you are able to help but have set and maintained clear boundaries, you can make special considerations to help. Sometimes, splitting the bill or lending money does make sense for you, especially if this friend has helped you financially. 

Establishing these boundaries before someone asks for financial help will allow you to communicate with your friend. 



What are examples of financial boundaries?

There are different types of financial boundaries that you can set. 

Some examples of boundaries are: 

  • Not talking about money
  • Not investing in family or friends' business ideas 
  • Not lending large sums of money 

These boundaries can vary depending on the relationship. You may have more strict boundaries with friends, but fewer boundaries with your family.

For example, if your brother needs to borrow money for a repair, you can consider helping him. If a friend asks for the same request, while you wish you could help, you have to say no. However, you can offer help in fixing that repair if there is any work you can do on it. 



How do you say no to family asking for money?

It's challenging to say no to your family. Saying no to friends can be easier.

Your family knows they can count on your full support, but that usually means emotionally. When it comes to your financial support, family may lump that in, but it's very different. 

If your family asks for financial help and you're not able to contribute, you need to tactfully decline these financial requests. You have to navigate complex emotions and maintain those relationships. 

You could say something like:

  • "I'm sorry, but I'm not in a financial position to help you right now."
  • "I really want to help, but I don't feel comfortable lending money. How else can I help you?"

If you have been stung by helping this person before, you can also be direct about turning them down. 

  • "I'm sorry Pete, but the last time I lent you money, you didn't pay me back."

If a family member asks for you to invest in a business idea, you want to be supportive, but maintain those boundaries. For example, instead of complete rejection, you can explain that you can't financially help, but you can help professionally. 

Like any boundary you set, there could be times when you do offer financial help. However, if you can help, ensure it still respects your boundaries.  



Final Thoughts 

Setting clear financial boundaries with family and friends is important.

Without clear boundaries, your finances and relationships can be negatively impacted. Take a look at your relationships and see if you have any financial boundaries set with your family and friends. If not, make sure you look at your financial situation and make boundaries that work for you.

Photo by Edmond Dantès


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