Talking about money with friends and family has long been considered taboo; lending money is viewed as even more problematic. But a Bank of America study put a number on the amount of money that can damage a friendship for good.
In the 2017 survey of 1,000 nationally representative respondents, Bank of America found that almost three-quarters (77 percent) of respondents said they would end a friendship over $500 — and 40 percent said they would end one if the dispute was just $100.
Money was cited as the fourth largest cause of stress in friendships after jealousy, gossip, and disagreements. According to the data, the only topic people would rather discuss money with friends over is personal hygiene.
Now if you’re thinking to yourself that $100 or even $500 is too little to end a friendship over, Bank of America found that for many respondents, the damage money can cause to a friendship was based on real experiences.
Fifty-three percent of people said they’d seen a friendship end over money, a fact that led 77 percent of respondents in the survey to believe that an IOU is harmful to a friendship.
“Friendships can endure a lot, but money is not one of those things it can endure,” said Meredith Verdone, then-chief marketing officer at Bank of America. “I thought that was high and pretty surprising.”
Interestingly, the survey found that around 40 percent of Americans have avoided a friend who owes them money because it’s so awkward. Unsurprisingly asking someone to pay you back ranked at the top of most uncomfortable situations.
“It’s a stressor on both ends,” said Verdone, who left Bank of America in 2021. “It’s this awkwardness — no one wants to ask.”
Verdone put the data in context of modern peer-to-peer payments, noting that technology (think Venmo, PayPal, Square Cash, Zelle) used to send a payment requests takes some of the burden off what used to be an in-person demand.
How Much Money Does it Take to Ruin a Friendship? Survey Says $500
In our current climate, everything seems to have gotten a little more expensive. From food and vehicle repairs to toilet paper and the cost of credit card debt, prices are going up, but wages are not rising as quickly. This is forcing some to take to social media to declare – loudly – what they are willing to spend money on and what they will not.
But sometimes our quest to not spend more of our own money can come at the cost of our friendships. What happens when someone’s desire to be thrifty turns them into a jerk?
Ava and Adam (not their real names) know this all too well.
As the Brooklyn-based couple shared with Bustle, it’s increasingly common to receive Venmo requests along with invitations to house parties so that the host can cover the cost of food and drink without falling into debt.
The couple, who are both in their 30s, had received one such Venmo-invite from Adam’s close work friend Steven. Before the party, Steven sent a text saying: “Hey, if you’re coming to the party, please Venmo me $20-$25 or more so we can get everything we need. There’ll be tons of food and drink.”
Although Ava and Adam thought it was a strange request — especially knowing Steven made more money at his job than the two of them combined, they sent Steven the money and hoped for the best.
“We would be like, ‘There’s going to be a ton of food there; we’ll go [to the party] hungry; we’ll see a bunch of people; it’s going to be really fun,’” Adam told Bustle. “But we’d go to these parties, and there would literally be a pack of Oreos, a bag of SunChips, and a table full of liquor.”
After a while, they noticed a pattern. Steven sent reminder texts asking for money up front, sometimes four or five of them. After one party, he let everyone know he’d collected way more than he needed but didn’t offer to give any of it back.
He usually asked people not to bring their own beverages, saying he didn’t want his fridge full of six-packs he’d never drink — and then didn’t offer any alternatives to alcohol.
“It’s crazy to be like, ‘Don’t bring your trash; I know what’s good,’” Ava, who’s sober, told Bustle. “For me, navigating being in social situations and not drinking, normally it’s a totally [understandable] thing. … Let me bring my LaCroix and not make a big whoop out of it.”
For Ava and Adam, the last straw was when Steven invited the couple to a dinner party at his house. Along with the requisite Venmo requests, he asked his 10 or so guests not to bring any additional food.
“Just Venmo me for the dinner,” the text said.
Ava, who’s a chef, shared that she usually brings a dessert or side dish when she’s invited to friends’ homes, but Steven insisted that she not bring any additional food because he had plenty.
“We got to the party, and there was a tray of lasagna, a small thing of tiramisu, and some liquor,” Ava says. “I know it didn’t cost you $200 to make a lasagna.”
While some may applaud Steven for not putting the financial burden solely on himself for hosting his friends over; but for Ava and Adam, it’s enough to let the friendship fizzle out.
“It confirms for us that the joy of hosting is getting all the people you love together to make memories, have a laugh, enjoy a meal,” Adam says. “[Asking yourself], ‘How much do I need to charge for this so I don’t lose money having my friends over?’ That’s not cool.”
Loud Budgeting vs Extreme Frugality
When you’re on a debt payoff journey, or perhaps you’re on a journey to achieve financial independence and retire early (FIRE), or are saving up to buy your first home, it can be difficult to maintain a busy social life. It can also impact friendships and family dynamics.
Another Brooklyn-based couple, Jeremy and Julia, (not their real names), are in their 30s and admitted to Bustle that they tend to avoid their frugal relative, Ryan, the partner of Jeremy’s cousin, who’s planning to retire at 35.
According to Jeremy and Julia, Ryan is so focused on his financial goal of retiring at 35 that money has become an issue at family gatherings and even casual hangouts. Now planning family events requires extra work from everyone to “rearrange the whole thing” around what Ryan will shell out for.
“He doesn’t drink very much, and neither does his fiancée. When they have people over, they’re like, ‘Oh, we have water,’” Julia says.
“If you’re going to penny-pinch because everyone owes $50 and you owe $43, that just makes it way more complicated [for everyone],” Jeremy says. “If everyone owes $50 and you owe $6, that’s a different story. But if you’re penny-pinching over a few dollars, f*ck off.”
But frugal living doesn’t have to damage relationships, says Tanja Hester, the author of Wallet Activism: How to Use Every Dollar You Spend, Earn, and Save as a Force for Change.
After years of intentional saving, budgeting, and investing, Hester retired from her job in political consulting at age 38. Now 44 and based in north Lake Tahoe, California, Hester says she and her husband considered the impact of their financial plan on friendships at every step.
“We didn’t cut out stuff that felt important. It’s not like we said, ‘I won’t come to your wedding because I’m not spending money on travel,’” Hester says. “We didn’t want it to isolate us socially, and we knew that would be very possible.”
Hester says she managed to save money and maintain her social relationships by proposing alternatives to more expensive gatherings, such as hosting dinners for friends at home rather than going to a restaurant, pivoting to low-spend holidays, or spending time outdoors with friends. Most of the time, Hester says, other people will be relieved at the opportunity to hang out for free.
She also suggests being mindful of how you explain your budget priorities, making it clear that you aren’t judging loved ones for how they spend their money. And if you do make plans that involve spending: Don’t try to cut corners, like skimping on the tip.
“That’s a bad look and guaranteed to hurt relationships,” Hester says. “I firmly believe in a ‘don’t be an *ssh*le’ rule.”
Have you lost a friendship with someone because of money? Does $500 seem like a reasonable amount to let a relationship fizzle out over? What do you think of sending Venmo requests to guests? Do you have a friend or loved one you avoid because of their extreme frugality? Share your story with us in the comments below.