Very frustrated with my best friend

[WannabeWealthy]

All,

So my friend decided to quit his job and go full time into the car business using Uber/Lyft.  To accomplish this, he bought (a year ago) a Yukon Denali costing over $90k. His note was $1,100/month.  OK.  So he now can use the black service.

Recently, he decided to change his own oil on the vehicle to save money and forgot to put fresh oil in the car.  He started the engine and it ceased up on him.  He took it to the dealer and got lucky.  They decided to replace the engine on their dime.  While waiting on this fix, he decided yesterday to buy another car costing him $50k with the intention of being able to rent it out occasionally.  So he took out another loan on his business for $50k @ 6.59% interest for 7yrs to buy another vehicle with 60k miles on it.  He even put the taxes/title/registration in the loan.  *sigh* He's now paying $2,500/month for the two vehicles combined.  He has very little money in his 401k (~100k) and no cash at all.  He swears he will become profitable soon and I've argued with him that he has went overboard with the borrowing and that he has a problem with borrowing.  He got 2 credit cards specifically for his business account so he can start using those for gas and expenses.

In all, I think my friend is headed for disaster.  He is way too optimistic about his car business and ignores rationale thinking.  I'm going to sit back and see how this all unfolds.

[swamp]

It's got disaster written all over it.  But, not your circus, not your monkeys.     Have the name of a good bankruptcy lawyer available to him.  

[jerseygirl]

Some folks think a business loan or cc won’t be theirs if business runs into trouble. Wrong, these rely on the person who has the business (small business)
Uber and Lyft usually aren’t that profitable
Yep not your business not your monkey but it’s difficult to see someone sinking into disaster

[Cookies Galore]

Unless you've invested in his business it's not your problem. Just let your friend be your friend and not a burden on your mental capacity.
And so what if he "only" has $100k in his 401k? At least he has something. It's not a static amount and will grow, and again, not your problem.

I talk financial stuff with friends but JFC I don't get into specific dollar amounts.

[minnesotapaintlady]

Be grateful it's just a friend and not a spouse, parent or kid!

I agree. Disaster in the making.  Hopefully he realizes that before it gets too bad.

[Deleted]

Darn, that's sad and what's even sadder is that there are lenders willing to hand out that kind of money to someone who may have a hard time paying it back.  How do you even clear $1,100/month with Uber to make the car payment, let alone have money to pay other bills?

I agree that it's not your circus, not your monkeys, but still hard to watch.

[finnime]

Your friend is going to realize very soon that profit for him is not just the $ beyond what he owes, but has to be above other expenses including insurance and related for him. I share your concern, but what can you do? Just be ready with information on how to manage when it all falls apart, I guess.

[dannylion]

Definitely not your problem.  It does sound like a disaster in the making; but who knows, he could find himself in a fortunate spot where what he has to offer is exactly what everybody needs at that moment.  Stranger things have happened (not often, but they happen).  

I wouldn't loan him money, though.  

[Artemis Windsong]

Another poster on this site had a BIL do something similar with the Uber black.  His name will come to me in the middle of the night.    Maybe he'll chime in with the end of the story!

Where did the down payment o n the vehicles come from?  Also at fault are the lenders for not doing due diligence on ability to repay.

Edit: Uber black cost is $3.75 per mile.

[Opti]

Aug 17, 2022 10:30:41 GMT -5 swamp said:

It's got disaster written all over it.  But, not your circus, not your monkeys.     Have the name of a good bankruptcy lawyer available to him.  

Also sounds penny-wise and pound foolish. For a 90K car it would be better to use a dealer or a known mechanic than do it yourself unless you have specific knowledge. I'd probably mention that a BK in the first three years of his business will be a personal BK and on his record for 10 years. Returning the 50K vehicle or selling it sounds wise to me, but some see the upside and ignore the potential downside.

[WannabeWealthy]

Aug 17, 2022 17:13:47 GMT -5 Artemis Windsong said:

Where did the down payment o n the vehicles come from?

$0 down.  He wrapped everything into the loan.

[WannabeWealthy]

Aug 17, 2022 10:39:07 GMT -5 jerseygirl said:

Some folks think a business loan or cc won’t be theirs if business runs into trouble. Wrong, these rely on the person who has the business (small business)
Uber and Lyft usually aren’t that profitable

Yep not your business not your monkey but it’s difficult to see someone sinking into disaster

He swears that it is profitable.  He's been doing them for years part-time and now he's just tired of his job of 15yrs.

[WannabeWealthy]

Aug 17, 2022 11:50:23 GMT -5 Cookies Galore said:

Unless you've invested in his business it's not your problem. Just let your friend be your friend and not a burden on your mental capacity.
And so what if he "only" has $100k in his 401k? At least he has something. It's not a static amount and will grow, and again, not your problem.

I talk financial stuff with friends but JFC I don't get into specific dollar amounts.

$100k @ 53yrs old isn't what I would call "something".  If that's all I had to my name, I would be frantic.  His net worth is $70k minus the new vehicle he just purchased.

[giramomma]

Did your friend actually ask you for advice or your opinion? Did he ask you point blank if he thought he had a problem with the borrowing?

I have had best friends that I have truly loved.  But, at the end of the day, it was still a friendship where their lives were separate than mine, and their decisions simply just did not affect me, at least not in the same way that my husband's decisions affect me.

If your opinion was not asked for, and you cannot keep it to yourself, then I'd suggest dialing down the friendship.

I had to do that with my best friends. Ultimately, it did lead to the friendship falling apart. But, I was Ok with the natural evolution on good terms rather than ending the friendship with bad feelings, anger, etc.

[TheOtherMe]

My friendship with a long time friend ended when I could not take listening to any more stories about the house she has been renovating since the 80's and nothing is finished.  Nothing.  

It did lead to our friendship ending because that was the only thing she could talk about and friendships are a two way street.  That had been lost.

She has lost many friendships over that house.

[thyme4change]

Aug 17, 2022 12:36:29 GMT -5 @athena53 said:

Darn, that's sad and what's even sadder is that there are lenders willing to hand out that kind of money to someone who may have a hard time paying it back.  How do you even clear $1,100/month with Uber to make the car payment, let alone have money to pay other bills?

I agree that it's not your circus, not your monkeys, but still hard to watch.

My husband is a BK lawyer, and has been periodically asked about his view of the ethics of borrowing and not repaying. His stance is "Lenders and debtors deserve each other, and deserve the consequences- they are both at fault." Refreshing take vs Dave Ramsey blaming the debtors and Bernie Sanders blaming the banks.

[Ryan]

This wouldn't bother me in the slightest to be honest.  Worst case scenario, your friend flops and files BK.  Mid-case scenario it's moderately successful, but allows him to get the break he needs from his job.  Best case, it's the start of a good business.  I would guess that it would land in the middle category, but who knows.  In any case, it's not your problem.  Like they say, if they aren't listening, then stop talking.

[Cookies Galore]

Aug 18, 2022 8:02:05 GMT -5 WannabeWealthy said:

Aug 17, 2022 11:50:23 GMT -5 Cookies Galore said:

Unless you've invested in his business it's not your problem. Just let your friend be your friend and not a burden on your mental capacity.
And so what if he "only" has $100k in his 401k? At least he has something. It's not a static amount and will grow, and again, not your problem.

I talk financial stuff with friends but JFC I don't get into specific dollar amounts.

$100k @ 53yrs old isn't what I would call "something".  If that's all I had to my name, I would be frantic.  His net worth is $70k minus the new vehicle he just purchased.

But that's you, not him. I'd be frantic, too, but not my household not my problem.

And yes, having some money in a retirement account is literally the definition of "something." Not what I'd want at that age or the gamble I'd be willing to take but it is literally something. Remember, a lot of Americans bury their head in the sand and don't save anything at all. We're the anomalies here.

[WannabeWealthy]

Aug 18, 2022 8:38:31 GMT -5 giramomma said:

Did your friend actually ask you for advice or your opinion? Did he ask you point blank if he thought he had a problem with the borrowing?

No.  This is me sharing with you guys.  My friend just told me what he was doing and we argue about his decisions but he still does what he wants to do.  I just can't believe he's living in a "my little pony" lens of reality.  Everything he plans is always going to turn out right.  He never considers the negatives that are bound to happen since entropy is real.

[thyme4change]

A lot of people age on social security, part time work, welfare programs, charity and family.

[minnesotapaintlady]

Aug 18, 2022 11:01:45 GMT -5 WannabeWealthy said:

Aug 18, 2022 8:38:31 GMT -5 giramomma said:

Did your friend actually ask you for advice or your opinion? Did he ask you point blank if he thought he had a problem with the borrowing?

No.  This is me sharing with you guys.  My friend just told me what he was doing and we argue about his decisions but he still does what he wants to do.  I just can't believe he's living in a "my little pony" lens of reality.  Everything he plans is always going to turn out right.  He never considers the negatives that are bound to happen since entropy is real.

I get it.  I have a similar friend that was the same way and I've vented here before about him as well.  My friend is much better now that he got married and his wife keeps him in line. 

[Ryan]

Aug 18, 2022 9:28:39 GMT -5 thyme4change said:

Aug 17, 2022 12:36:29 GMT -5 @athena53 said:

Darn, that's sad and what's even sadder is that there are lenders willing to hand out that kind of money to someone who may have a hard time paying it back.  How do you even clear $1,100/month with Uber to make the car payment, let alone have money to pay other bills?

I agree that it's not your circus, not your monkeys, but still hard to watch.

My husband is a BK lawyer, and has been periodically asked about his view of the ethics of borrowing and not repaying. His stance is "Lenders and debtors deserve each other, and deserve the consequences- they are both at fault." Refreshing take vs Dave Ramsey blaming the debtors and Bernie Sanders blaming the banks.

I mentioned in the other thread that my sister has a gambling problem and my dad bailed her out of her CC debt.  I warned my dad against doing the same thing again when she opened up additional credit cards and took cash advantages.  I told him he's essentially bailing out the cc companies and they (and her) need some consequences to their decisions.  

[giramomma]

Aug 18, 2022 11:01:45 GMT -5 WannabeWealthy said:

Aug 18, 2022 8:38:31 GMT -5 giramomma said:

Did your friend actually ask you for advice or your opinion? Did he ask you point blank if he thought he had a problem with the borrowing?

No.  This is me sharing with you guys.  My friend just told me what he was doing and we argue about his decisions but he still does what he wants to do.  I just can't believe he's living in a "my little pony" lens of reality.  Everything he plans is always going to turn out right.  He never considers the negatives that are bound to happen since entropy is real.

I get the venting. Lord knows I do it here enough.

And, it is hard watching a trainwreck. It is frustrating when problem solve with someone you care about and even go out of your way to help, and in the end they do what they want to their detriment.

And it takes two people to argue. Unless your friend is the type that will argue with himself.

FWIW, I find that coming up with some empathetic yet general responses before I enter conversations with someone of that sort really helps. If it makes you uncomfortable, you can always try a benign statement "Mmmk. How about them <insert local sports team> or Did you see <insert new tv series starting, or movie>

A tiny bit of detachment is something you can do so you don't get frustrated.

[TheOtherMe]

It was when I lost all empathy for my friend that I let her go.  I was the last of her friends to do it.  She had driven everyone away once I was gone.

[WannabeWealthy]

Aug 18, 2022 12:32:23 GMT -5 TheOtherMe said:

It was when I lost all empathy for my friend that I let her go.  I was the last of her friends to do it.  She had driven everyone away once I was gone.

Wow.  What happened?

[TheOtherMe]

30 years of complaining about how she couldn't get her house that she bought as a foreclosure during the housing crisis in the 80's wasn't finished.  The same stories told over and over and over and over.

If you offered a suggestion, she told many of her friends off and so that ended the friendship.

I got tired of it no longer being a friendship.  It was all her and no listening to anything I said.  

[Bonny]

Aug 18, 2022 9:28:39 GMT -5 thyme4change said:

Aug 17, 2022 12:36:29 GMT -5 @athena53 said:

Darn, that's sad and what's even sadder is that there are lenders willing to hand out that kind of money to someone who may have a hard time paying it back.  How do you even clear $1,100/month with Uber to make the car payment, let alone have money to pay other bills?

I agree that it's not your circus, not your monkeys, but still hard to watch.

My husband is a BK lawyer, and has been periodically asked about his view of the ethics of borrowing and not repaying. His stance is "Lenders and debtors deserve each other, and deserve the consequences- they are both at fault." Refreshing take vs Dave Ramsey blaming the debtors and Bernie Sanders blaming the banks.

 

2008 was a cluster f*ck because there were so many players who contributed to the mess and very few had actual skin in the game. But it's so much easier to blame everybody else than to take responsibility for your choices as an adult.

I thought the movie "The Big Short" did a great job explaning in layman's terms what happened.

[Bonny]

Aug 18, 2022 11:03:22 GMT -5 thyme4change said:

A lot of people age on social security, part time work, welfare programs, charity and family.

Yep, and all the while complaining about folks who don't pay their fair share.

Hello mirror!  

OP, your friend is an adult, makes his own choices and gets to live with them.