Should anyone ever use Go Fund Me to pay off a debt? 

Written by
Jenni Hill
Finances expert
26 October 2021
6 min read
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GoFundMe has changed millions of lives since its creation in 2010. 

Recently, a popular Netflix documentary, Tinder Swindler has documented how the fundraising website has helped a group of women who were cheated out of their savings by an online-dating swindler. 

GoFundMe has become a go-to place to raise awareness of worthy causes, from a family that has lost everything in a fire, to a child needing life-saving treatment abroad. 

However, one cause that sparks some controversy is debt. 

Crowdfunding debt is more common in the US, where tuition fees are much higher and even minor illnesses can lead to big medical bills. 

If you’re struggling to make ends meet and you can’t see a way out of your financial situation you may be tempted to start one yourself. 

What are the benefits of crowdfunding debt? 

Creating a GoFundMe page and crowdfunding your debt can have its advantages. 

It can make it easier for friends and family to help in whatever way they can. 

Whether they pay off a credit card in full or they can only afford to chip in a fiver, every donation makes a difference. 

You won’t have to directly approach people for money, which can help you and those you care about avoid awkwardness. 

If a friend or relative doesn’t want to contribute, they could simply pretend they hadn’t noticed your campaign. 

For those who make donations via GoFundMe, it can be satisfying to know where the money is going and to see the impact it has on someone’s life 

If you’re lucky, your campaign might attract the attention of generous strangers. If someone has overcome debt themselves and can relate to your situation, they might be willing to help. 

However, crowdfunding personal debts is not without its downsides and it’s wise to think carefully before venturing down this route. 

Here are a few things to consider:

For those who make donations via GoFundMe, it can be satisfying to know where the money is going and to see the impact it has on someone’s life 

Asking for money could damage relationships with people you care about 

Although your friends and family want what’s best for you, they might disagree strongly with the concept of crowdsourcing consumer debt. 

Many loved ones will keep their feelings to themselves, but arguments could happen with more outspoken friends and relatives. 

If you want to find out how to borrow or lend money to a mate without ruining your relationship, check out our guide here. 

Pressure to donate could place strain on others in debt 

Debt is more common than you might think. 

You might not know the extent of a loved one’s own money problems because people often choose to keep it a secret due to shame, guilt and worry. 

Meanwhile, they might be worried that if they don’t donate, you’ll think badly of them. 

If your campaign goes viral, can you handle the criticism? 

From time to time, interesting and unusual GoFundMe pages are picked up by the newspapers and go viral on social media. 

While this could lead to a greater number of donations, it, unfortunately, could result in criticism and trolling too. 

Strangers on the internet won’t hold back if they disagree with your decision, and handling this type of criticism can require a thick skin. 

Sometimes GoFundMe pages are picked up by the newspapers and go viral on social media – be prepared 

You’ll lose the satisfaction that comes with paying it off yourself 

Becoming debt free through your own hard work and determination can be incredibly satisfying. 

By taking control of your finances, you’ll gain a sense of achievement that can be hard to replicate. 

Verena Hallam, 31, Lancaster, paid off a whopping £13,000 of consumer debt and says she’s learned a lot from the experience. 

She explains: “I googled whether or not I should declare myself bankrupt because I felt like I had no other options.” 

Thankfully, she didn’t go down that route, and by doing some research and learning about money, Verena got to work transforming her spending habits. 

“I learned to budget and got super strict and frugal,” she says. 

I’d got myself into a position where I couldn’t afford to spend money on things such as buying lunch every day, or drinking every weekend – I had no choice but to cut back.” 

She transferred all her debt onto 0% credit cards, which helped to make it more manageable. She also looked for ways to make extra money on top of her salary so she could increase her repayments. 

Verena says that she was surprised at how lucrative selling online turned out to be. 

It might shock you what people will buy on eBay these days. Did you know that you could sell your empty candle jars and perfume bottles and might make serious cash? Find out how to  turn your trash into treasure  with our guide. 

By avoiding GoFundMe and paying off your debts through more traditional means, you might be surprised at the positive response you get. 

“It feels great to be in a position where I now have some money saved instead,” she admits. 

“Paying it off properly helped me to learn a lot of great financial skills and develop a healthier relationship with money – and believe it or not, I’ve become the person my friends come to when they need help with saving cash.” 

What are the alternatives? 

Debt can be incredibly overwhelming and it can be hard to know where to turn, but there’s help available without crowdsourcing. 

Sara Williams, a debt adviser and blogger at Debt Camel, explains that alternatives are available for those thinking of going down the GoFundMe route. 

“Too often people pin their hopes on unlikely events, and postpone actually dealing with their debts for months,” she says. 

“This sounds like one of those situations. If you think you have a debt problem, it’s better to talk to a good debt adviser now, such as National Debtline, or Business Debtline if you’re self employed. 

“The sooner you do this, the better, as you may have a wider choice of debt solutions. A good debt adviser will explain the pros and cons of the options – the choice is up to you.” 

3 things to do right now...

Download a money management app which analyses your spending to help determine if you can afford repayments. If not, this is a good time to look for ways to cut costs. 

Like many problems in life, the sooner you try to get to grips with debt, the easier it can be to solve. If you've got more than one debt and can't afford the repayments, the best place to start is by contacting the lenders directly. 

If you feel unable to tackle your problem debt on your own, getting help from a specialised charity StepChange and the Debt Advice Foundation which are charities that give free, confidential, impartial advice. Money Helper, an independent service set up by the government, also offers free and impartial advice through a free phone line or via online chat. 

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Don’t forget that while you may think that this article is brilliant, it is intended for information purposes only and should not be mistaken for financial advice or recommendations.