DEAR HARRIETTE: I am an entrepreneur. I have helped a good friend of mine who owns a struggling business that lacks funding, and it has caused a great deal of stress on both of us. My friend has not been able to pay me for my services or even cover their expenses, yet I have continued to help out, providing services to the best of my ability. I feel for my friend and want to do everything I can to support them, but at this point, I am reaching the limits of what I can do without being paid. I'm in a difficult situation, not wanting to take money from my friend, but also feeling like I should receive payment for my services. Is there anything I can do to support my friend without breaking my financial commitment to myself and my business? -- Need Payment
DEAR NEED PAYMENT: It is often difficult to do business with friends and family because the lines are easily blurred. Your friend is far less likely to pay you for services than they would an outside contractor they don’t know. Is that fair? No, but it is common.
What you must do immediately is begin looking at this relationship as strictly business. Moving forward, make an invoice along with a clause for terms for payment and interest or penalties that may accrue if payment is not made in a timely manner. Stop providing more services until you are paid for those already executed. Express your interest in helping your friend, but establish that you have to step away for now in order to tend to your business. When theirs is fluid, perhaps you can rejoin the project. But do know that it is unlikely that you will ever receive payment for whatever you are owed if your friend lacks the funds.