Beating Broke

Personal Finance from the Broke Perspective

How to Deal with a Person Who Keeps on Asking for Money

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Most of us know a family member or friend who is always asking for money. They may start their request with a typical line, “I hate to ask, but I have a financial situation and wondered if you could help?” If they’ve asked you many times before, they may also add, “I promise, this will be the last time I ask.” Sound familiar? If you have experienced this, here’s how to deal with this type of person in your life.

Recognize Your Role in the Problem

If you have a person like this in your life, recognize that you’ve enabled this person to feel dependent on you. You do this by lending the person money over and over again even though the person repeatedly shows that she is financially irresponsible.

I don’t point this out to make you feel bad but rather to help you recognize your role in this cycle. However, you can take steps now to end the dependency and become part of the solution rather than the problem.

How to Deal with a Person Who Keeps on Asking for Money

The first step is to decide that you won’t allow the person to take advantage of you anymore. Instead, try one of these tactics.

Firmly Say No

The next time a friend or family member asks for money, firmly but nicely tell him that you can’t lend him money anymore. Be confident in your delivery. If you say, “I’m sorry, I just can’t lend you money right now,” or “This week my money is tight, so I can’t give you anything,” you leave open the prospect of giving him money in the future, and the person will ask again next week.

You must instead clearly say that you will no longer be able to help him out financially. Then, he has no choice but to receive and understand your message. He may ask you again at a later time, but perhaps he won’t be as persistent in his request.

As you continue to firmly say no to his every request, he will stop asking. However, don’t be surprised if he becomes angry with you and perhaps even stops speaking to you for a time.

Manage Her Finances

If you’re close to the person, perhaps offer to manage her finances and teach her good financial habits. My roommate in college, Jenny, was terrible with money and regularly asked her friends for handouts. One of our friends, Simone, was studying to be an accountant. She offered to manage Jenny’s finances. Jenny happily agreed.

For six months, Simone managed Jenny’s finances. She set up a budget for her and gave her money for spending, gas, groceries, etc. Simone paid the rest of Jenny’s bills with Jenny’s money. Once Jenny got used to the system and having a limit, Simone taught her to budget her money and pay her bills herself. By senior year, Jenny was a budgeting pro and even sometimes offered to pay the tab when she was out with friends.

Person Keeps Asking for Money
Photo by Jarritos Mexican Soda on Unsplash

For this arrangement to work, you must be close to the person, and you must both trust one another. In addition, the person has to want to improve their financial situation. If the person doesn’t have any interest in managing her money, you’ll just waste your time.

Offer Him a Financial Course

If you don’t want to manage his money (which is understandable), you could offer to pay for him to take a financial course. Financial Peace University is a Dave Ramsey course that has helped many people turn their financial lives around. However, it’s not the only course available. Find one that will best resonate with the person and that you can afford to pay for.

When you make this gesture, you’re not refusing the person outright. You’re refusing to enable the person, but you’re offering to pay for a class and invest in him and his education. This shows that you want to keep the relationship strong.

Why You Should Stop Lending Money

Saying no to someone who repeatedly asks for money can feel awkward and embarrassing. However, you should say no for several reasons.

You Work Hard and Should Keep Your Money

You likely work hard for your income. Giving a portion of that money to someone who mismanages her own money isn’t fair to you. If you choose to donate the money, that’s your decision. However, if you give this person money out of guilt or because you feel bad saying no, do yourself a favor and value yourself, your time, and your money more. You’ll feel better when you do.

Avoid Spousal Disputes

The number one cause of divorce is money disputes. If you continually give money to someone in your life, chances are your spouse is not happy about this. Your spouse will likely be much happier if you learn to say no to the person. Then, you can use your money for your own family—for vacations, retirement savings, college savings, etc.

Let the Person Become Independent

You may feel bad when you say no. You may wonder how she’ll survive without the money she needs for whatever pressing emergency she has now. She’ll probably be angry with you and lash out.

However, take the time to look in the future. Imagine how much happier and stronger this person will be in a year when she is no longer looking for handouts and knows how to manage her own money. She’ll be more confident and feel better about herself. By saying no, you’re helping her grow as a person.

Final Thoughts

Saying no when a person keeps on asking for money isn’t easy. However, remember that you’re doing the right thing for yourself, your spouse, and the person who keeps on asking. When you set clear boundaries, you strengthen your relationships. If the person doesn’t understand this, you may, unfortunately, lose the relationship. If she does understand and makes changes, she’ll thank you later.

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How to Make Money From the Things You Buy

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Being broke is terrible. It is bad for everyone. It really should be outlawed. Unfortunately, that would make far too many people outlaws. Come to think of it, that is a pretty bad idea. There are all kinds of bad ideas with regard to being broke. Many of those bad ideas are generated and accepted by the people who can least afford to fall for them. If you have some of those bad ideas knocking around your head, you could be your own worst enemy when it comes to beating broke.

One of those bad ideas is that being broke is your lot in life so you might as well accept it. But that is simply not true. Sometimes, the first step is to find the right kind of emergency loan so you can start the process of righting the ship. Installment loans direct lenders provide are better than your typical payday loan. Remember, you are looking for the kind of loan that gets you out of trouble and not the kind that gets you into deeper trouble. After you get your head above water, consider the following tips to help you spend in a way that actually makes you money:

Buy Bulk

You always save money when buying in bulk. That could make that Costco membership worth the small amount they charge. By sharing that membership, you share the savings. If you eat out for lunch every day, you can save a ton by bringing your own. The types of ingredients you need will cost a lot less in bulk. Just remember there is a reason you bought that membership. It was not to buy all the things you are used to in the same quantities. You need to be prepared to stock your pantry like you mean it.

You also need to have a clear purpose for your shopping. You are not shopping to help you mindlessly snack while you are on the couch watching Netflix. You are shopping to fuel your work. Fueling your work with economical and healthy lunches that you prepare yourself is a money-making enterprise and not the typical, annoying chore. You might also be helping your children succeed in school. Lack of a healthy lunch at school hurts children more than you think. This is not a political talking point, but an indisputable fact of the world. Don’t just mindlessly shop. Find a good shopping club and shop with a purpose.

Buy only What You Can Write Off

Even if you don’t itemize your taxes, you should make purchases as if you do. There is nothing wrong with buying that new computer. First, ask yourself how that computer will help pay for itself. Is it the tool you will use to create an ad-supported blog? Is it going to help with editing the photos you will license to a stock photo service?

The same question applies to kitchen gadgets. By all means, buy the bread machine. But take a few loaves to work to sell to your coworkers. This is perfectly acceptable in many places of work. Check with your supervisor before you do. You can also make snacks for people at your church and accept donations. The idea has nothing to do with getting rich. It has to do with you changing the way you think about making purchases. Don’t buy anything you can’t monetize and legitimately include in your taxes and learn about the tax code for families, businesses, and real estate. Being uneducated could literally cost you money while also hiding opportunities you didn’t know existed just because of failure to study up a little bit on your situation.

Resell

Some items will only be good for recycling after you use them. Intentionally limit those types of items. To the extent possible, only buy things you can resell to someone else at a later time. Learn to use reselling websites. When you resell a device, you help the environment and you can pocket the money from the sale or convert it to another item which you can later resell.

Unless your business is restoration and reselling, you will not make a lot of money by following these tips. But you will come a lot closer to making a profit if you buy bulk, stick with items you could write off as a business expense, and buy only items you can resell to someone else. Be sure that everything you purchase goes to work for you instead of the other way around.

Managing your Newfound Wealth

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If you’re used to being broke and have made some money recently, you probably have an uneasy feeling because you don’t know what to do with it. This is normal and natural. Still, there’s no reason to allow this to define your new state of stability. While you may not know exactly how to use your extra money, this should be an exciting new prospect.

There are so many ways to manage money and use it to make more. Once you have beaten poor life, this new, more prosperous one will afford you opportunities you never could have imagined before. Read on to discover some different ways to manage your newfound wealth.

Consult Financial Advisors

If you feel really in over your head and don’t know what to do with your money, consulting financial advisors is a good idea. Don’t necessarily let them know how clueless you are, but ask for the best ways to invest your money. They want you to succeed because they will be receiving a cut of what you make with their guidance.

One city that has really become known for financial advising is San Diego. With so many beautiful neighborhoods and properties, real estate is a great option for investing. Consult with a wealth management San Diego team whether you’re thinking about purchasing property there or simply want overall advice on what to do with your money. You won’t regret gaining their expertise.

Invest in Stocks

Lately there has been a lot of talk about the stock market. One thing you can do with your money is invest in stocks. While you might want some guidance on what companies to invest in and how the market is swinging, putting money into some stocks can put it to good use. You will have the opportunity to make more money and put your new wealth to work. Not only is it a great investment, you will have some fun with it and use investing as a hobby.

Real Estate

Another way to invest your money is to get into real estate. Whether you rent out a property or buy a home to live in, property is a great way to put your money to use and make more while you’re at it. When you have the ability to buy some property, you will be able to keep money around in the future. Tying up some cash in a home or business property will give you the peace of mind that you need to when you have new money that you aren’t used to having.

Start a Business

If you have a lot of money you don’t know what to do with and have a business idea you’ve always been meaning to do. Whether it’s a café, a restaurant, or a tech start-up, investing your wealth into a business that could be quite lucrative is a great way to use your money. There is never a better time to try that idea you’ve always wanted to try. Starting a business can be risky, but if you put in the time and effort you can make more money and find your passion. Get the help that you need for starting the business, you won’t regret going for it.

There are quite a few ways to manage your newfound wealth. You can invest in real estate, starting a business, or in the stock market if you want to make more money. However you choose to use it, asking for guidance is never a bad idea. When you’re not used to having money, you may be hesitant to use it. You could also go the other way and start spending too much money.

When you finally have money, it’s time to forget about your poor life. You have beaten it and should now function in a different way. You have money now. Be smart about it and use what you have to make more and enjoy yourself while you do it.