Is money a friend owes you money you can spend?

Money a friend owes you is yours, and I still do not count it as money I can spend until it arrives. It may never arrive, or it may arrive after payday, and what I have left has to get me to payday. That is how I treat my own money, not a rule for everyone.

The question usually comes up after you have paid a shared bill. The money has left your hand, your friends owe you their shares, and it is tempting to count those shares as if they were already back.

Why not count it, if the money is really yours?

Money that is owed to you is really yours, and the trouble is the date, not the ownership. What you have left has a deadline, which is payday. What you are owed has no deadline at all, only a friend's good intentions.

Say you have Rs 4,570 left, and Bilal owes you Rs 1,200 and Sana owes you Rs 800. Count the Rs 2,000 as yours to spend, and you will plan the days to payday around money that is somewhere else. If it comes after payday, the plan was wrong on every one of those days.

When does the money a friend owes you count?

The money a friend owes you counts when it arrives, on the day it is in your hand. Until then I keep it out of what I have left.

This costs nothing when the friend pays on time. The money arrives, what is left goes up that day, and the days to payday get easier. It only matters when the friend is late, which is exactly when counting early would have hurt.

Does that mean writing the money off?

Leaving the money out of what you have left does not mean writing it off. It means keeping two lists: what you have, and what you are owed. The second list still names who owes you and how much, and it is still theirs to pay.

The two lists answer different questions. The first says whether you will make it to payday. The second says who to remind.

What about the money you owe other people?

What you owe other people is a different question, and this note does not answer it. I have a settled view only on the money coming in: it is not mine to spend until it is here.

In HisaabFlow, the money app you text, what is left to spend is your salary, less everything you have logged since payday, and a Room shows who owes whom. It is not open yet. See how Rooms work, or leave your email for early access and try the Guru today, before it opens.