How this calculator helps you decide
Enter the amount you have been asked for, when it is supposed to come back, and how likely you honestly think repayment is. Then add your savings, monthly expenses and how many months of expenses you want to keep as an emergency fund.
The calculator shows your savings and runway after lending, whether the loan eats into your emergency fund, the expected loss given your repayment estimate, and the interest your savings would have earned in the meantime. It then rates the loan as comfortable, tight or risky, with the reasons.
Only lend what you could afford to lose
Loans between friends and family are often repaid late, partly, or not at all, even with good intentions. The safest approach is to lend only an amount that would not hurt you if it never came back. The calculator shows that amount: your savings above your emergency fund goal.
- Agree the amount and a repayment date in writing, even in a text message.
- Consider lending less than asked, or giving a smaller amount as a gift.
- Set a reminder for the due date so the conversation happens on time.
Frequently asked questions
Should I lend money to a friend or family member?
Only if you could afford to lose the money without hurting your own finances or the relationship. Enter the amount and your savings above to see whether the loan would dip into your emergency fund.
How much money can I safely lend?
A cautious limit is the part of your savings above your emergency fund goal, since that money would not leave you exposed if it is never repaid. The calculator works this out from your savings, expenses and emergency fund target.
Should I charge interest on a personal loan to family?
Many people do not, but it is worth knowing what you give up. The calculator shows the interest your money would have earned in savings over the loan period.
How do I make sure a personal loan gets paid back?
Nothing guarantees it, but clear terms help: agree the amount, the repayment date and any instalments in writing, and set a reminder for the due date. PayCycl can track the loan and remind you when it is overdue.