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Penny For Your Thoughts: Tips for Friends with Bad Money Management Skills?

This post is part of our “Penny For Your Thoughts” column where readers can write to Penny about any questions related to money, finances, relationships, and more. If your question is chosen for the next Penny For Your Thoughts Column, you will receive a $20 Amazon Gift Card. In addition, one lucky commenter on today’s column will receive a $15 Amazon Gift Card.

Dear Penny,

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A friend of mine who I see frequently is constantly out of money and has very poor money management skills. She laughs about forgetting to pay her credit card bills until a debt collector calls and about eating cereal for dinner until the next paycheck. I haven’t always been the best with money myself, but it makes me uncomfortable that she’s clearly unable to handle her finances, and I worry about how she’ll manage in the future. I don’t want to offend her, but should I offer to help her?

–A Concerned Friend

Dear Concerned Friend,

If your friend is making jokes about her financial situation, instead of blithely acting like this is normal, she probably already has an inkling that this is not the wisest path to be heading down. I know it’s hard to watch your friends make mistakes, but you don’t want to become her financial nanny by watching over her too closely. If she asks for specific advice, you can certainly give her your opinions, but you never really know what exactly is going on with someone else’s finances, so I would advise against offering unsolicited advice unless your friend hints towards needing it.

The help she needs, and the best thing you can do, is to be a good example for her. If you’re concerned about the money she spends when she’s with you, you can suggest lower-cost or free activities. She might be thinking of making changes to her spending, but doesn’t want it to seem like it’s her fault that you have to go to the local dollar store. You can be the impetus for change. Whatever you do, do not fall into a pattern of paying for things for her and absolutely do not offer to lend her money unless she is in dire circumstances. You want to help her learn to stand on her own two feet and make good choices; you also don’t want her to inappropriately assume that you support her bad choices. Moreover, lending money to family and friends is a horrible recipe for disaster.

As a friend, you can be a great resource for her if she knows you’re willing to have these kinds of conversations. It sounds like she’s open to talking about it if she’s made a few mentions here and there. Admitting some of your own financial mishaps will help you find some common ground and make her feel more comfortable talking about her situation. Most of all, what your friend needs from you is to see that there is another way to deal with financial challenges and to know that she doesn’t have to let her mistakes rule her life.

Yours truly,


Readers, a penny for your thoughts! What have you done as a friend to help out in a bad financial situation? Was your friend offended or overjoyed?

Do you have a question about relationships and money? Write to Penny [at] moneycrashers [dot] com and win a $20 Amazon Gift Card if your question gets chosen! And one lucky commenter on this post will win a $15 Amazon Gift Card!

Update: The winner of the $15 Amazon Gift Card is Scott, with his comment shown below.

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