Doing some 12 step work and got to number 9 about making amends. I remembered that 38 years ago a friend loaned me several hundred dollars that i never paid back. I want to do that now - should I include interest? How would i figure the amount?
Posted Oct 1, 2017, 2:36 AM UTC
Whatever makes you feel like you've paid your debt. We can't speak for you here.
If the loan was in 1979, $1 then was $3.59 now. Source
Whatever makes
youthem feel like you've paid your debt.
OP is doing a 12 step program, it has to be about OP. The whole point is taking control of his life, allowing someone else to decide whether he has paid his debt would be counter to that point.
OK, I get that. But can OP honestly say he paid his debt if his friend doesn't agree?
If he believes it's fair and is at peace with it then yes, certainly.
If it is an actual friend, I would probably just slip an extra $100 in there for the inconvenience and thanks.
I would just give them 2 to 3 times the amount. If you can afford it
Yes, you should include interest. The bare minimum interest rate should be equal to the inflation rate in each year. Be prepared to be shocked at how much you should repay.
Just reading this makes me feel happy for you. Congrats for getting to where you are and good luck on your decision. Would be awesome to know how it works out if you feel comfortable sharing.
The recipient is going to be ecstatic regardless of your decision.
Good on you for stepping your way into recovery/healthier lifestyle.
I would offer interest, if they decline the interest, that's cool. But it'd be a really awesome thing for you to even offer it. Bank interest is something like 4% compounding monthly or quartlery. They're not a bank but something to consider. I've also heard 20% of the total works well too.
This is indirect to your questions but there's a wildcard here.. they may not care. You mentioned making amends, so if it severed a relationship they literally may just want to hear you say your sorry and take them out for dinner to catch up or something.
Pay whatever you can pay tomorrow.
If that's the with interest, then yeah pay that. If it's just the original amount then just pay that.
Don't destroy your financial situation or spend the next x months saving up.
And I don't know the person you're mending with, but to me it would make it worse if somebody paid me back and tacked on 3% interest or some shit like that made it okay. I would just want the trust and the relationship back.
Good luck to you. It works if you work it. So work it, you're worth it.
Honestly just hand them an envelope with the amount owed plus whatever you think is fair. Say thank you and leave it at that. Don't draw it out.
I don't think you should offer interest based on any metrics such as CPI or inflation rates. I'd say just offer an amount that you feel comfortable with and that is higher than the original amount loaned (such as 2x).
I mean, if someone came back to me after 38 years for a loan made back then, I'd probably turn him down or accept only the original, no interest amount if that person were to be persistent.
That is between you and your friend, making amends is about you and the other party coming to a mutual agreement on what makes you even. If he/she feels inconvenienced by not having that money or you feel obligated to pay extra you should. If your friend doesn't feel interest is nessisary and you don't feel the need to pay back extra you shouldn't. If you ask them about it a true friend will be honest with you about what they think about the issue.
You are a) either still friends and your debt has been forgotten long ago, or b) you are no longer friends because they never got over you not paying them back.
If a), you should ask them how much they want you to pay them back, otherwise you risk making them feel like you've cheated them by not paying interest, or the right amount of interest.
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I would be happy with the amount plus a bit extra, so I know you thought about it. I wouldn't need it to be calculated for compounded interest.
As a receipient, I wouldn't accept interest. It's the principle of paying back to be square and not how much I could squeeze you for some extra bucks.
Using this site: http://www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php
And these values:
$600 loan amount 7% annual interest (this is the average of what the market returns) 38 years
Your friend is out about 8500.
EDIT: Look here, downvoters. OP asked two questions. I answered the second. bugger off.
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Who gives out a friendship loan at 7% annual interest? And makes it compound? Why would you pick those parameters?
In the 70's, it was hard to get less than 18%
Who takes out a loan from a friend and doesn’t pay it back for 38 years? We can both play this game.
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