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First of all, welcome! I'm glad your friend directed you here, because this really is a great place to come for relationship support of any kind.
Second of all, I'm so sorry you're going through this - it's a real slap in the face when someone you love tells you, "I don't love you - I love someone else." You feel like it should kill you instantly.
As for walking away with self-respect intact, I think doing just that - walking away - is the best option. It's probably the hardest possible thing to do, too. But at the same time, you don't want to try to work things out with someone who doesn't love you and whose heart isn't in it. And, sometimes, you have to love someone enough to give them what they want - even if it isn't what you want. In order to help YOU, NC might be the best way to go. I don't know if he's mentioned wanting to "stay friends" or not, but I don't think it'd be good for you to do that right now - you're hurting badly and you need to heal.
While it's good that he was straightforward with you (eventually, anyway), I know how much it hurts when someone drops that bomb on you. You're in shell shock for a few weeks and then you just hurt. However, the one positive thing is - thought you don't feel like it now - you WILL feel better. There are so many of us here on this forum who have been exactly where you are right now, and we know what it's like. I know you'll be hurting for awhile, and we're ALWAYS here when you need support as you go through this.
Hang in there,
"Are tangerines really just oranges that didn't want it enough?" - Random Greeting Card