Financial expert and Snowball CEO Tanya Menendez shares tips and suggestions for how to handle the sensitive subject of providing support to family members.
It’s very common in Latinx culture that familia relies on each other. Personally, it’s one thing I love about our culture: We take care of our past, present and future family members. It’s more common than you might think for Latinx to support immediate family and relatives. Two things Latinx should consider are what is the appropriate amount is to give and whether combining cash with another type of support is doable.
Overall, it’s important to think of win-win scenarios. For example, can you save up to buy a home that is an investment for you, but is also a place for your family to receive reduced rent? How can you support your family and still build wealth for the future? Here are some ideas below:
What are some ways we can support our families?
- Teach them a new skill to help them begin making more money in the future.
- Do meal prep for them and cook for them to help them save money on eating out for lunch.
- If they are having a hard time living off their salary, can you help them set up a budget?
- Buy them food, pay for school or something they need instead of giving cash.
- Think about potentially saving to buy a house they can live in, instead of giving them cash every month.
- Consider setting up an emergency savings account for your family member, instead of buying a gift, for the next birthday or celebration.
Do you need to set boundaries?
- Create some accountability — if you are helping a loved one financially, depending on the situation, it might make sense to have a spreadsheet or email chain that shares how much you are letting them borrow and by when they can pay you back.
- Saying no — this can be hard, especially if it’s someone you care about. In the case that you do need to say no for whatever reason, you could use phrases like “Right now, unfortunately, I don’t have it in my budget” or “I wish I could, is there another way I can support you?” or “I can let you borrow $__” (instead of giving the $).
How can we invest in ourselves?
- Begin automatically sending a % of your salary to a high-interest savings or investment account.
- Buy stocks instead of things (whenever you feel the urge to buy something that isn’t going to last, see if you can buy the stock instead). Why do we hesitate to buy a $50 stock that has the potential to grow, but don’t blink at buying at $100 pair of shoes, or something similar — that has no chance of growing? **Ideally you’d have a real investment strategy around your portfolio, but, if you were going to spend that $50 anyway, why not on something that has the chance to appreciate?**
- Begin reading about personal finance, see the rest of the posts on CHICA here.
- If you are in debt, take the first step and just face it, organize it, and come to peace with it, so that you can begin tackling it.
- Check out the Snowball Latinx Guide for even more ideas.
Tanya Menendez is the co-founder and CEO of Snowball, an online platform that helps you tackle debt and investing through free personalized recommendations and affordable coaching. Menendez co-founded Maker’s Row, an online marketplace that helps democratize American manufacturing for small businesses. Menendez has been included in Forbes’ 30 Under 30 List and named one of People en Español’s Most Powerful Latinas. You can follow Tanya @makertanya and Snowball @asksnowball.