One of the best money advice I received is to learn to say no when people come to you for financial help.
It’s not easy – and some of you may even think this is the worst advice when we are all raised to value family and friends and to help out when we can, even strangers for that matter. So let me qualify that this is not about saying no all the time, but being firm to turn down requests for money when you are not really helping, but enabling bad habits.
Check out these situations and if they have happened to you. Did you say yes and regret it? Or possibly said no and learned a valuable life and money lesson? May I add that there is a way to say yes responsibly, so you can preserve relationships and your hard-earned money too.
#1 Pledged to send someone’s child through school
Education is important, and if you have a family member or a friend with a child that may have to stop schooling because of lack of funds, you may be tempted to step in and help. Nothing wrong with that, but don’t say yes too soon without thinking it through as you may come to regret it later. Is the child attending private school? Maybe he or she can move to a public school or a school with lower fees? Are there scholarships open? Are they having a problem only for one semester, or one year, or for longer? Consider all these before you raise your hand and take on this burden.
#2 Offered to pay for year-round school expenses
Two old friends fought and when the other was confiding in me, she let it slip that her friend had been having money problems for a long time. Turns out that her friend’s daughter was able to stay in her expensive private school due to the generosity of friends: a few pool their money to cover the tuition, others the books, then there are those who help pay the rent of their condominium. As for the one I was speaking to, she has been covering the school bus fees. Now that they are no longer on speaking terms, she said she is glad to be free of this burden. While I am glad she can hang on to her money, I can’t help but wonder why she even agreed to do so in the first place. If it takes a village to send that one child to an expensive private school, that whole village of enablers deserves to lose their cash.
#3 Said yes to hosting a party
If you have family or friends who want to celebrate someone’s birthday, or to host a baby shower, or a graduation dinner and come to you asking you cover all their expenses – and the celebrant is not your parent, child or spouse, just say no. If the celebrant deserves a party, not just you, but starting with the people who came to you should be willing to spend for it. It may be tempting to come out the “hero” here who made the event possible, but unless you have money to burn, this is an easy no.
#4 Lent money to an old acquaintance
If an old acquaintance suddenly contacts you for a loan, that’s the first red flag. If they need it right away and promised to pay you back right away too, that’s the second red flag. And if they say you can’t tell people you both know, that’s the third red flag and your cue to say no. Note that I wrote her “acquaintance”. Many people desperate for cash have likely already borrowed from their inner circle of friends, then the next outer circle, and at some point, will have to come to you, someone they know but not too well. That’s why you can’t tell others because they’ll be found out. And let’s face it, if they can pay you back right away, why even come to you? Their family, office workers and close friends should be ready to help. They’re not probably because they have loaned money in the past, and have yet to be paid back.
#5 Loaned money to friends, again and again
So maybe it’s easy to say no to an acquaintance but when it comes to friends and family, it’s easier to just say yes. Those who are making more money, or appear to be more successful, are an easy target. If you are one of them, you may have some feelings of guilt that makes it tough for you to turn them away. But if they have come to you again and again, you have become their personal ATM and that needs to stop.
When to say yes responsibly
Send someone to school if they have shown that they have explored all possible options before coming to you: switched to a cheaper school, applied for scholarships, and tried to take out a loan. I would be more likely to say yes if they came to me after all that, and asked for a loan, not a handout. As for year-round sponsorships, I can understand why it’s important to offer some stability to a minor, but that same minor and her parents also need to learn a lesson about living within their means.
Next time someone asks you to pay for a party, and you can’t say no, offer to send one item instead, like the cake or lechon. Hopefully, they’ll take the hint and it will set the tone for all future requests. Finally when it comes to loans, do not part with your money with no clear discussion on when you can be paid back. If you want to help, you can hand over a small amount that you won’t lose sleep over. Before you can be a money hero to others, be a money hero to your own wallet first.
Disclaimer: The views in this blog are those of the blogger and do not necessarily reflect the views of ABS-CBN Corp.