How To Deal With Financially Toxic People

If you were asked if you have friends or family members who are financially toxic people, your first answer might be no. However if the question was rephrased to — do you have friends or family members who seem to perpetually be on the edge of — financial disaster, but do it so effortless that it almost seems normal? A few names might come to mind.

Truth is, we all know financially toxic people and while you may think that your association with them is harmless, it often isn’t. If you constantly surround yourself with enough financially toxic people you may find your own financial situation being sabotaged. We definitely DO NOT want that, especially not in this economy.

So how do you handle financially toxic people, especially when you cannot exactly cut them out of your life? Here are three things you can do:

Reduce The Amount Of Time You Spend With Them
Sometimes you have no choice but to associate with financially toxic people, especially if they are your close friends or family. Carefully control the amount of time you spend with anyone you consider to be financially toxic, do your best to keep the time you spend with them to a minimum. This is because bad habits and negative behaviours are easily transferred from one person to another in a gradual way, you might not even notice it happen. So if you are trying to save money for an important goal or to get out of debt, spending too much time with someone who spends money freely, may cause you to lose your focus.

Don’t Try to Keep Up With Their Spending Habits
It is very easy to get trapped into thinking that you need to adopt spending habits of friends as a way of fitting in with the group. However, by doing this it takes you completely off of your financial game. The more time you spend trying to match someone else’s spending habits, the farther you’re moving from your goals. Don’t get distracted, stay in your financial lane.

Do not Lend Them Money
This goes without saying, but if someone doesn’t value their money, they most likely won’t value yours. This is why banks and other lenders run credit reports on new loan customers. Experience has shown that if a borrower has a history of defaulting on loans to other lenders, there’s an excellent chance that the outcome will be repeated. And it should be the same with you.
Lending a financially toxic person money is just inviting trouble. In the instance that they can’t repay the loan, not only will you lose the money you gave them, but it will almost certainly end the personal relationship that you had with them.