Friends and money don't mix: Part 2
I have been relatively ok in life as far as finances are concerned. I was taught well by my parents about how to handle money and sometimes i get called stingy for this. Go ahead and label me if you want but i know from experience that there is nothing quite as stressful as not having enough money and therefore I prepared accordingly in life.
There have been several times in my life that I tried to help out other people with my good-fortune an more often than not, i have been burned as a consequence. This is part 2. part one can be read here if you are into that sort of thing
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2: My old pal Max
Years ago, i was doing relatively well. I'm not trying to brag but I was a relatively successful business owner. I was so successful actually that I over-expanded and my brand was starting to suffer as a consequence. I was spread too thin and the overall service and quality that got us a good reputation was starting to suffer. I also had a lot of friends that were pretty bored with their own lives so at one point a guy I had been friends with for a long time proposed that I hand over one of my guesthouses to him and his wife.
I would still manage the overall image, and the bookings would come through me, yet I would be able to eliminate all of my costs associated with one of my guesthouses by handing it over to them. From that point forward they would handle all the expenses and running of everything. In exchange for doing almost NONE of the work, I would receive 25% of the profits. Since I was already damn near burnt out and ready for a bit of relaxing I agreed.
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I think i let my laid back attitude and general good nature get the best of me because almost immediately things started to go badly. Because I had been friends with this couple for years, we didn't have a written contract. The first couple of months went very well, and it seemed like everyone was making money. Because at this point I had 8 years of experience in this industry I informed the couple that since this is a seasonal business, they need to save the money that they make in high season in order to cover the costs of low season.
They didn't listen. Every time i turned around they had new stuff. They bought a new car, they bought lavish birthday gifts for their son like a PS4 and massive TV, they were out to eat at fancy places and posting it on social media. They were completely ignoring my advice.
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a great Jay-Z quote
Lo and behold, the low season came around and you can't give away your rooms for free and have customers... I told them this was coming. They couldn't afford to pay the rent without dipping into one of their salaries unrelated to the business and all of a sudden they were looking at me as though I was stealing from them. Then the deception started, the altering of accounts to the point where I had to call them out multiple times for misrepresenting their figures. Did they really think that they were going to be able to trick me inside of an accounting system that I created?
They ended up walking away from the business right after the following high season (basically after making all the money, thus leaving me with the shitty time of year)
All in all, this partnership, that I didn't really even need to do and it was more of a favor to help out a friend with a new project, ended up losing me 15 thousand dollars or so. Such a great friend right? The couple now live their lives exactly the way they always have: If they have a little bit of money they spend it all and then put more on credit.
I learned a valuable lesson dealing with these two and that is to not get involved with friends in business because you are going to lose one of them.
I get no pleasure in seeing someone else fail, especially if I had a friendship with them at one point in my life. However, it is really astounding to me that this guy and his wife can so continually make the same bad choices financially and never learn from them. The last I saw them they lived in a shitty apartment in Bangkok and were living paycheck to paycheck. I know I will never get the money they owe me back and they don't even acknowledge that it exists.
It's true partnership in friendship most of the times( surely not always) turn out unsuccessful. it seems like you really had bad experience with it. are you still working on that guestroom project? Is it successful?
anyways Keep flourishing and yes, we should learn from our mistakes otherwise it's worthless.
Wow! If you were a bit psychic you could probably avoid this bad experience with people you think were your friends.
It seemed you were so nice and easy going, you expected and thought your friends would behave responsibly but they had something devious in the making!
Several years ago, I met my old friend at family’s funeral. I was introduced to her new partner. I could sensed straight away that he was dangerous. But I could not say a word as they were very much ‘in love’. Several months ago, I heard of the breakup and adultery including stealing jewelries and mild poisoning! There are bad crooked people around everywhere, it depends on your luck whether you’ll become their victims or not.
So, it’s good to be on guard as your good nature can cloud over your subconscious warning!
I always use my psychic antenna to pick on those bad vibes in order to stay away from them. But sometimes, kindness gets in the way!
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Sorry to hear about this but you're right 100%. I had a similar story with my best friend (back then she was). She had an opportunity to go to Mallorca, it was a last minute deal but she had no money to spend. I lent her some and she promised me she won't spend it unless it's necessary and she would give me back asap.
She spent all the money on clothes. She was living her normal life, bought all she needed for herself, bought stuff on credit and every time she told me she can't give me my money back as she didn't have any. Took me two years to get my money back and it wasn't a huge amount.
With friends like these who needs enemy, right? I've learned my lesson just like you. Never ever!
I mean, it can work but often times I would agree with you here. I know of a few people who work with their friends and it isn't an issue, but it's a bit different as they're co-workers and no one is in a superior position. I think I only know one person with that situation, but they've been running their business for over 10 years alongside two friends and they haven't had an issue come up yet. Hopefully they won't.
I can definitely see this just turning into a shit covered train wreck though more often than not. I mean, hell, I won't even loan most of my friends money because I've seen my mom get burned bad by loaning out money to friends and family. (She got into massive debt and never came out because of it. My cousin did a fraudulent check of 40k and instead of charging her, she just let it go because my aunt said she would pay her back since her kid was the one who fucked her over. Who would have guessed, the snobby troglodyte never paid my mom back. There were several other times she loaned money out that never got given back. I think she's probably still 70-80k in debt.)
So, If I give someone money I treat it as a gift. If they insist on saying they'll pay me back, I just tell them they can get me a drink or some food next time we hang out. Makes it much easier where I don't have to worry about shoving my chocolate starfish in someones mouth over $20.
i can see how going into business together could be very different for obvious reasons such as no seniority and equal motivation to succeed... That sucks about your mom though, for sure.
Yeah, I would love for her to just file bankruptcy and start over, but I doubt she ever will. I don't wanna go into that though, the whole situation is a rabbit hole of negativity.
It sucks some fat scrotum that you had so much bullshit go down with your friend though. I'm glad you at least put some space between yourself and them and have moved on in good standing. All I can say is fuck that guy and his wife and I hope they get some e-coli infections from sucking so much filthy ass.
Playing devil's advocate here. If you can't mix money with friends then they were never your friends to begin with. They just never had the opportunity to exploit you until that business deal came about.
When things are going well, everyone wants to be your friend but the truth is your real friends show up during hard times. Sadly, I have learned this hard way and found out that I am a lot more lonely than I thought :(
yeah, that's a good point. I have borrowed money from friends in the past, large sums of it, but I always held up my end of the bargain and spent very little money on myself until the debt was repaid. I have never been late on a repayment to another individual ever.
I have experienced issues with friends in the past and now don't mix finances with friends at all. The ones you think you can trust the most normally let you down. It has been a good lesson learnt though so no hard feelings.
This was an incredible read, very well written. Following.
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I’ve been to court twice over money and friends... it’s not a fun thing to do and I’ve finally reached the point where I now follow specific rules so it doesn’t happen again. Contracts are now mandatory, I’ve found people that aren’t going to be up front back away quickly once contracts are mentioned.
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that's a good plan for sure. Have you presented someone with a contract and then had them back out for real?
They usually don’t get to the contract part. It’s usually suggesting a contract, being told we don’t need one, when I insist they back away. I have a friend, named Keith, who was in contracts talk with a guy that kept sending the contact back saying it needs to change before he signs. It went back and forth a few times, Keith changed the money parts to ice cream and the guy never mentioned it. He did keep saying they should start work (it was to create a website and games) and work out the contract later. Kieth did the website then locked everybody out till the contract was signed for the profits. That was a fun couple of weeks.
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Intresting Blog like part one. Would you borrow money again?
i think you might have missed the point. :) oh wait, maybe just a language thing. NO, I will not loan money again. It will be a gift or nothing.
My english writing skills are poor I know. It was a long time ago when i learned english. My mother language is german.
But I think you understand me what I meant. Have a good Day.
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