In the last year, around 9 million found themselves increasing their borrowing to tide them over for another month or two. Borrowing money from family and friends is often the most common form of borrowing and can often be interest-free and without any credit scoring or approval process. But it is important to understand the pros and cons since money between family and friends can compromise relationships. 

Pros Of Borrowing Funds From Family And Friends

Borrowing money from family and friends can often be a good idea when you need funds urgently. When unexpected circumstances do arise, family and friends may offer to support you out of goodwill and will often be able to help out quickly, providing you with whatever you need for the time being. Borrowing from family and friends also means you won’t be forced to pay back extra on your loan, as you may have to from a bank, payday lender or credit union. 

Banks and other lending facilitates often charge ridiculously high-interest rates, meaning that you risk not being able to repay the money borrowed within the pre-arranged time frame, therefore paying additional interest and being trapped in a vicious cycle. This can then lead to excessive debt, meaning that it was not worth borrowing the original money in the first place.

Family and friends may also encourage you to pay them back what you owe quickly, as they don’t want to risk not having their money returned. Consequently, borrowing from those around you may entice you to repay the funds as you don’t want to be in debt to people you see on a regular basis, whereas borrowing from a bank or large institution might mean you feel less pressure to repay the money as you don’t know where it has come from.

 Some families also lend their relatives money without the requirement that they ever pay it back. Many parents and grandparents set funds aside, saving money to pay for their children’s education, weddings, cars and house deposits. This can save their family from taking out loans with interest rates in the future and provide financial support through more difficult times.

Cons Of Borrowing From Family And Friends

Whilst family and friends may offer financial support in a time of need, it may not always be the best solution. Close relations may not demand that the money they have lent you should be repaid, leaving you feeling guilty and not wanting to ask them for financial aid in the future. 

“If repayment terms are too loose,” explains John Gauthier of Hoopla Loans, “this can create an uncomfortable atmosphere, with people expecting repayment within a certain timeframe. Things can get tricky if you do not repay when expected or if you cannot repay at all, this makes things extremely awkward. 

“Make no mistake, when it comes to money, things can get very tough even between close family members.”

Borrowing from those around you can also create animosity if you are embarrassed to explain your financial situation to them and ask for help. They can also refuse to lend money, leaving you with no option but to take out an alternative loan.

One of the most popular American sitcoms, Friends, is enjoying a revival thanks to being made available on Netflix in January. Now a new generation of fans is laughing at the exploits of Joey, Chandler, Ross, Rachel, Monica and Phoebe as they live in downtown New York, grow into adulthood and drink a lot of coffee.

Over the course of the show, each character has their highs and lows when it comes to their careers. Monica is a great chef, though is reduced to working at a ‘50s diner. Joey falls on tough times after being killed off from Days of Our Lives, and Chandler quits his job at (wait, where does he work, again?) and joins the competitive world of unpaid internships.

This got us thinking, which of the characters did best by the time the show ends? Who had the most impressive career and who is still struggling to get by? We combed through all 236 episodes of the show and teamed up with James Calder from Distinct Recruitment to estimate the wages for each character and see who came out on top:

Looks like Joey, despite his unstable career through many of the earlier seasons, was the highest earner. After being hired back to Days of Our Lives and sharing a film with legendary actor Richard Crosby (Gary Oldman), Joey is riding high when the show comes to an end. He had quite the journey getting there, too, as he racked up 17 different jobs in total. No doubt he had more than a couple of loans from Chandler while slumming it as a cologne sampler, Christmas tree salesman and even, briefly, a gladiator model at Caesar’s Palace in Las Vegas.

While Joey earns the most, we can’t overlook Rachel’s transformation through the show –  starting as a coffee house waitress and ending up as a merchandising manager at Ralph Lauren. Chandler had the biggest fall from grace, leaving his job in data analysis and data configuration to become a junior advertising copywriter.

We’re all guilty of it – we’re trying to stay frugal and save every penny, but something comes along that tempts us a little too much. During our research, we found more than a few examples of the Friends gang splashing out and buying something outrageous. Who can forget Rachel’s cat, Mrs. Whiskerson, the boat Joey accidentally buys at a charity auction, or the leather pants that left Ross in a tight spot during a date? Being the lowest earner of the group, Phoebe was also the most sensible with her money, only spending $240 in her attempts to get Rachel to move back in with her.

(Source: giffgaff)