Dave Ramsey Warns Against Lending Money to Friends and Family: 'It's a Slave/Master Relationship'

Financial expert Dave Ramsey recently addressed the common dilemma of lending money to friends and family, asserting that such transactions fundamentally alter personal relationships. In a recent discussion, Ramsey stated, "When you loan your friend money, they are no longer your friend. Their primary relationship is now slave and master." He elaborated that the borrower becomes a 'slave to the lender,' creating an inherent power imbalance that can lead to discomfort and tension in social settings. Ramsey shared a personal experience to illustrate his point. He recounted a time over 30 years ago when his father-in-law loaned him money to keep a car after he went broke. Despite his father-in-law being "the kindest, most saintly man" who never made him feel uncomfortable, Ramsey admitted that sitting at Thanksgiving dinner felt different until the debt was cleared. "Because it's in the air. It's a slave/master relationship. You change it," he explained. Ramsey's advice to those considering financial assistance for loved ones is straightforward: if you can afford it, give the money as a gift with no expectation of repayment. This approach, he suggests, prevents the erosion of personal relationships that often accompanies financial obligations between friends and family.

Yahoo Finance

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