The Money Maven sheds light on how to stop the cycle of financial abuse
It amazes me how many people are subjected to financial entrapment and don't even realize it. You've seen domestic financial abuse play out on the big screen. Remember Sleeping with the Enemy, and Enough, and all of those Lifetime flicks that shows the victim stuck and nowhere to go because they don't have control over any of their finances, or even worse, they have no finances at all because of their domineering partner?
"Financial abuse is a form of mistreatment in which an abuser forcibly controls a victim's finances."
The Money Maven, Patrice Washington, is back with some key advice on how to avoid and how to get out of financial abuse if you or somebody you know are on financial lockdown.
The Money Maven wants people to understand that financial abuse is not only limited to romantic relationships, it can also creep into the picture very subtlety with close friends and family members. It can happen when they lead you to believe that without your constant and consistent help and support, they’ll suffer from some unimaginable fate.
"Did you know that senior citizens lose billions to financial abuse? According to research from insurance provider MetLife, Americans over the age of 60 lost about $2.9 billion to financial abuse in 2010 – up 12% from the $2.6 billion lost in 2008."
She also noted that financial abusive relationships often stem from the abuser’s inability to earn their own income or manage their own money wisely enough to distinguish between wants versus needs.
“It’s one thing to assist someone who finds himself or herself in a bind from time to time,” Washington shared. “It’s another to add their needs to your monthly expenses.”
Here are three steps Washington said will put an end to the cycle of financial abuse:
- Stop Enabling, Start Empowering: The old Chinese proverb ‘Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime’ is applicable to many financial situations. By providing your kids, friends or family members with a financial security blanket, you are continuing to enable them to live without basic money survival skills. Remember, real need inspires real motivation. People will not learn to be responsible as long as they know they will always have you as a backup plan.
- Refer Those in Need to Community Resources and Services: Rather than reaching for your wallet the next time you receive a request for a little monetary support, cut the financial cord. Actions speak louder than words and as much as you may threaten that this is the last time you will help, what you do will speak much loudly than what you say.
- Remove Yourself From the Equation: This is not about you doing a good deed or being the family martyr- in fact, this is not about you at all! This is about each person figuring out life for themselves. If nothing else, remember that the money you continue to dole out to irresponsible friends and family members could be used to get yourself out of debt, buy your first home, or save for your retirement. Financial abusers do not care about you or your future and when the money runs out, they will just move on to the next overly generous enabler.
TC's Tip: One piece of advice my older sister gave me is to always have at least one checking or savings account separate from your household fund. She also advised that your significant other should never, ever learn about it.
I had to learn my lesson the hard way from my first marriage. After the divorce, I was left with only $300 to my name and the clothes on my back. You would think I would have known better after all those Lifetime movies.
You can get more personal finance advice from Washington’s book Real Money Answers for Every Woman.
Here’s a little more about Patrice Washington.
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