Money, Money, Money!

The Stages of Money Lending-image of hands cupping money plant in dirt.

There are generally two types of people: those who lend money, and those who borrow money. “Borrow” is a sneaky word with several meanings. Webster’s Dictionary defines it as “To receive with the implied or expressed intention of returning the same or an equivalent.” I, on the other hand, define it as getting something you need from some sucker with the intention of returning it if you were to somehow win the lottery.

Money is very important to all of us. We need it to buy necessities in life like a place to live, food, transportation, shoes, cell phones, Netflix and lattes. So, to part with it for any other purpose than for our own needs is very difficult.

I encounter this resistance when I donate to a charitable organization. Yes, I know I’m called on to be a cheerful giver, but I just haven’t gotten there yet. I wonder if my money is really going to what it is purported to. Instead of digging a water well in Tibet, some shyster is sitting in first class on his way to Greece on my dime.

I don’t trust people with my money, especially when they think it’s theirs. Most of us work hard for our money, so to let it go toward something that’s not for us or our family is hard, especially when the average American has less than four hundred dollars in their savings account. We’re at the point where it’s every man (or gal) for themselves.

At some point in our lives, someone has approached us to borrow money. It’s usually a relative or some close friend. Most of the time they’re coming to you because they know that you have been responsible with your funds, saving them for a rainy day, while they have not been responsible with their own funds. And now, they are having a rainy day. And guess who they’re looking at to be their umbrella?

Now you’re left wondering if they really need that car repaired, or if they’re hoping to score a bag of heroin, or if they’re looking to take Hopalong in the sixth to win.

The art of borrowing money has many stages to it. The first stage is The Request. This begins with the person expressing some sort of predicament they’re in. They’re short on rent this month. They’re waiting for a check that should be in the mail. Or they have a chance of getting in on the ground floor of the greatest business deal ever, like edible kittens. They usually start with a sob story hoping to provoke a response from you like, “Hey, if you need to borrow some money, let me know if I can help you out.”

You’ve just now opened the door to what is known as The Money Beatdown. This has just saved them the groveling they were prepared to do and, on top of that, they feel like they didn’t ask you for anything. After all, you offered.

check this out

As a mark, I try and always be in on my toes when I sense The Request coming my way. One of my favorite maneuvers — The Slick Cut Off — is one I learned from Muddy Banks in Tupelo, Mississippi in the early seventies. Right after someone has spilled their hardluck circumstances, before they have a chance to ask me for anything, I say something like, “You too? I’ve had some bad luck lately myself. I was just about to ask you if I could borrow a few bucks.”

Boom. I just turned the tables in the blink of an eye. Now I’m on offense and they’re back on defense.

I began to develop the method with precision on the Baltimore streets when I encountered panhandlers. I can usually catch these sidewalk beggars out of the corner of my eye approaching me for some coinage, so I quickly move towards them and, before they open their mouth, I hold out my hand and say, “Hey bro, you wouldn’t happen to have any spare change like a quarter, a nickel, anything?” Boom. I just flipped the script. I’ve disarmed them, and they’ve got nothing to come back with.

Now, I’m a little more lenient if one of them has a pet that does tricks, like a guy in New York who has Guinea pigs that can sit so still you believe they’re dolls, until they blink (incidentally, that guy makes $40-$50 an hour. No lie). I have no problem doling out spare change for that. That’s entertainment.

When someone asks you if they can borrow some money, you may tell them something like, “I need to check my finances,” or maybe “Yeah, give me a couple days and let me see what I can do.” This is known as The Time Tactic. The key being that you’re just buying time, hoping they’ll forget or find another source. At this juncture, as the borrower waits for your decision, they are at your beckon call. They will go out of their way to do you favors, stop by with little gifts, go out to lunch and answer the phone when you call them any time of the day. They will act excited to talk to you because you are the nicest, greatest, best friend in the world.

Unfortunately, there are times when you are left with no choice but to lend the money. I refer to this as The Box-In. This is where no dodging ploy is possible. It’s your best friend and you’re not willing to lose the friendship. It’s a co-worker and you know work will be a living hell if you don’t fork anything over, even though you’re certain he has a severe gambling problem. It’s your wife’s brother and you know it’s a favor to her, even though you know it’s a losing proposition.

When I have a bad feeling about a relative or a friend not paying me back, I use what I call The Teaser. I give them a taste of the apple — a nibble if you will — if I’m trying to preserve a relationship.
Say they hit you up for a thousand bucks. I tell them I don’t have it but, if it’ll help, I could lend them a hundred. They usually jump at this. After all, they were expecting some lame excuse, like that you’re tapped. This serves several purposes. First, it lets them know that you care about them. And maybe you didn’t give them the full amount, but it was something. They have no reason now to get pissed at you (most get pissed because they think what’s yours is also theirs).

Second, you tested their trustworthiness with a small amount. If they don’t pay you back, it hasn’t crippled you and you’re left with only a little resentment. You can live with the loss. If they do pay you back, you know next time you can lend them a hundred and three dollars.

Thirdly, and most importantly, it gets them off your back. It’s like a note that tells them to move on to the next pigeon. Yes, ultimately, it could cost you a hundred smackers up front, but in the long run, you most likely saved yourself nine hundred bucks.

And, when you do lend someone the money, they rave about what a good friend you are and reiterate how quickly they’re going to pay you back. You feel good for helping someone in need and you truly believe they will pay you back as soon as they can. This is known as The Fool’s Illusion.

At this point in the money lending process, it’s important to note that the borrower is still a friend of yours. They are pleasant toward you. You talk, you do things together… nothing has really changed, except for one small, itsy-bitsy detail: they now owe you money. You’re not too concerned about it, though. After all, they’ve been super nice to you and appear very sincere in re-paying you.

Some people lend money with an open-ended repayment period, meaning they’ve told their lendee something like “Oh, just pay me back when you can.” This usually occurs for those small loans, like a ten-dollar lunch. It’s no big deal if they don’t repay you or if they simply forget. You’re not going to lose your house over it.

However, if it becomes a recurring theme, it can add up. This is The Nickel-Dime Effect. In their minds, they’ve beat you before out of ten or twenty bucks and you never asked them for it back, so they see you as a dupe who forgets things or just doesn’t care.

Sometimes taking your lumps can be a good thing, because it’s a red flag to loan this person a higher amount. If they can’t handle paying you back twenty bucks, what do you think your chances are for two hundred? I’d say two hundred to one.

When most people borrow money, they give you a time period that they’ll repay you within. Why? Well, this increases their chances of getting the loan. “I’ll pay you back when I get my next paycheck,” is an old favorite, along with “I should be getting my tax refund check in the next week or two.”

Now, this is important. I truly believe that most people who borrow money have the sincere intention of paying you back when they say they will. They believe it and you believe it. We call this The For-Sure Promise. You’ve looked into their eyes and been guaranteed you will get your money back.

The drawback with this belief system is that there is a variable that looms in every future. It is known as “life”. This intangible thing is a relentless, sneaky S.O.B. It hides in the shadows and makes its move when all seems to be going well. One day you’re taking the family out for a dinner treat at Applebees, and the next, you’re all cuddled up around a candle to keep warm while dividing a box of macaroni and cheese. Why? Because life had just bitch-slapped you with some unintended expenses. A tax bill, a doctor visit, bald tires, fixing the cat, etc. Choose your poison. Damn you to hell, life. Forgive me for having a moment of hope of someday having a savings account.

Because of these unintended consequences we all encounter, we are left no choice but to prioritize our limited funds to our unlimited expenses.

We’ve now reached the point that psychologist’s label The Slide. This is when your loan is demoted and is slid down the priority list of payments. So the money — your money — that you were expecting back at a certain time — say, the borrower’s next paycheck — well, that has lost its significance. Life has attacked the borrower. The choice of them getting a brake job that the mechanic tells them they desperately need, or you getting your loan back… well, for most people, this is no choice. It now becomes “every man for himself”. This stage, The Cold Slap, means you have now been put on ice until they can get their life back in order.

When “the slide” occurs, once in a blue moon, you’re informed about it. A few noble borrowers will explain their predicament, and then set another re-payment date. However, if we wish to deal in reality, it is a
rare occurrence.

We now typically find ourselves stepping into The Avoidance Period. This is when the borrower begins to avoid you at all costs. Phone calls aren’t returned, they don’t stop by to visit you anymore, and if you do see them, it isn’t for long. You see them for one brief second and then poof, they disappear.

We have now reached the stage commonly known as The Ducking Mode. Before you lent them money, whenever you saw them, you always had a nice, lovely conversation. But now they’ve become oddly busy, like a little bee, always on the move.

You have now ventured into The Chase Down. You have no choice but to seek your borrower out. Eventually, you can track them down and you are brought into the big-story excuse, commonly known as The BS Explanation.

You’re now given the reasons why they have been avoiding you. These may include trouble with the cell phone, the death of an aunt or an uncle, the flu, something with the family pet, and the old “life’s been crazy” standby. This is code for “I don’t have your money.”

After they inform you that they haven’t forgotten about you, they set another date, usually next week, to repay the loan. That, or they start The Piece Out Program. This is when they give you some of your loan back. Although it’s a small amount of the original loan, it’s not necessarily a bad thing. They are at least showing good faith. However, the problem with The Piece Out is that it typically doesn’t last long, and you then return to The Chase Down.

Perhaps the most ironic leg of the whole borrowing progression is The WTF Experience. You’ve had no luck getting your money back. You’ve heard all the excuses and you’ve been given all the repayment promises. You’ve convinced yourself that this person must be going through some hard times. But you then hear stories of awesome weekends they’ve recently had at the beach, nights of clubbing, a family vacation, the new lawnmower… hell, they’re living better than you, and it’s thanks to you. If you ask them, “How could you go to Hawaii after you still owe me money?” They would respond with something like, “Oh, we planned that trip before I ever borrowed the money.” Oh, okay, my bad.

At some point you will move into The Bad Guy Stage. It is inevitable. This is the part where asking them when you will get your money back is responded to with hostile, irate, rude responses to your inquiry. You have now become a pain-in-the-ass to them. You’re the problem. You’re the bad guy. This was your fault. “Well, you shouldn’t have lent me money” is their defense.

Now, this is the important part. Nothing has changed since you first lent them money out of the kindness of your heart. You didn’t ransack their house, vandalize their car, kick their dog… but somewhere in the process you went from being the best person in the world to the bad guy. You’d most likely still have their friendship had you not lent the money. Crazy world, isn’t it?

They say when you lend money you should never expect it back. It’s a good rule of thumb. When I heard this golden advice years ago, I loved it. I loved it so much it made me switch sides. Instead of being a lender, I became a borrower. Since then, I’ve slept like a baby and everybody likes me. Well, except for those pesky lenders.[/am4show ]

by Jeff Charlebois

sharing is caring

we did our part - now do yours and share

like a good neighbor, share

Related Articles: