Stop Being the Family Bank

Today we’re talking about being the family bank. You know who you are.

You’ve achieved the amazing things. Then you sit down with your CPA or financial planner, look at your retirement account, and think, “Where’s the money for my future? This doesn’t look like it’s supposed to.” Who’s going to take care of you at 70, 80, or 90? How will you pay for caregivers or long-term care?

What you may not realize is that you had the money. You were the family bank.

Where the money went

“Hey cuz, I need $100 for this.” “Sis, I need $1,000 for that. I’ll pay you back.” “Niece, I need…”

Think about decades of that. After two, three, or four decades, you look back and realize you’ve given away close to six figures, maybe close to seven, for family members’ emergencies. A lot of us have done exactly that.

My favorite cousin

I’m 51. I started doing hair and owned my own salon in my early 20s, and I learned this lesson early.

One of my favorite cousins used to come sit in my salon and talk. I’d always looked up to him, so I loved it. We’d tell old stories about growing up. Then one day: “Cuz, can I borrow some money?”

He was watching me work and watching the money come in, so how could I say no? I said yes. He paid some of it back, then came back for more, and more. It became a pattern.

Then one day he stopped coming. He never paid me back, and I was hurt. I didn’t know our relationship was based on me taking care of his emergencies.

That taught me that no matter how hard I worked, to protect my peace and my purse, I had to say no. That lesson, from over three decades ago, is what saved me financially.

My best friend since 13

In my early 20s, my best friend since we were 13 called and asked to borrow money. I said no.

She got quiet and started to take it back, and I explained: “If I give you money and you can’t pay me back, we lose our friendship over a couple hundred dollars. If you don’t have it now, you may not have it then. Yes, I have it. But no, I’m not going to loan it to you.”

To this day, she tells that story. And to this day, we’re still friends, because I said no.

If someone exits your life because you won’t finance it, they were going to exit anyway, just like my cousin did.

Why I don’t keep money in savings

If you’ve watched my videos, you know I say I don’t save money. I have a savings account with no money in it, because the bank won’t give me a good return.

Instead, I take the money I’ve worked for and buy assets. Real estate is my jam. My real estate pays for my lifestyle and my future, without me having to work for it. It’s why I can golf every day, and why I haven’t worked since 2018.

I could only do that because I realized early that I can’t be the bank for family and friends who won’t pay me back and won’t be able to take care of me if something happens.

$500 from your future self

When you get that text, “Can I borrow $500?”, remember: if I give you $500 today for your emergency, that’s $500 I’ve taken from my future self. That $500 could go toward an asset that pays you over and over again.

My husband, who just left for a golf trip in Puerto Rico, asked me recently whether I ever imagined, back in the grind, that I’d be golfing every day. I said no. I was a single mom raising two kids, in survival mode. Nobody taught me to take care of my future self. But something inside me, and I believe it was the good Lord, said: don’t give your money away to people who can’t take care of you.

Why I keep talking about money

Friends and family used to tell me, “All you talk about is money.” I’m going to keep talking about it. If your finances aren’t in order, you’ll be stressed out, no matter how good your career is. Money problems are one of the biggest reasons marriages end. When we polled our community, being stuck in a financial trap was most women’s biggest concern.

Giving money to people who can’t give it back is a financial trap. The way out is to say no, and be okay with losing a relationship that’s based on money.

Find your vehicle

You don’t need a lot of money to start investing in real estate. There are turnkey properties, syndications, and other passive options. You don’t have to flip houses or do the physical work.

I got started by becoming the bank for other real estate investors. I used retirement funds and lent money to investors. That’s how I started protecting my purse.

Real estate is my jam, but it may not be yours. Find the vehicle that protects your future. I’m not a financial advisor, just a retired nurse, a retired hairstylist, and an investor telling you what has worked for me. This isn’t get-rich-quick.

For you today

• Add up roughly what you’ve given or lent to family and friends over the years. Let that number sink in.
• Practice your “no”: “Yes, I have it. But it’s for me and my future self.”
• Choose one way to put that money toward your future instead.

See you tomorrow, live at 6 AM Eastern on YouTube.