Growing up financially disadvantaged, I always had a keen sense that I would turn things around once I was old enough to take advantage of the opportunity. At the same time, one of the driving forces behind me wanting to do this was so that I could help others who weren't so privileged. Little did I know at the time, there were some fundamental factors involved that showed I didn't understand what help really meant.
The first factor was perhaps the biggest and took the most time to realize and that was "You Can't Help Everybody". Surely it sounded nice to have money to dish out to family and friends who needed an extra hand because I always dreamed of having money in such abundance that they could get it and not worry about repaying it because it would be only a small penny of what I would ultimately be worth. I watched frequently as they asked others in our trailer park for $5 here or $20 there, rarely going over $100 because they knew the people that they were asking, much like them, simply didn't have it. I knew I would have it and thought that being asked for it wouldn't much matter. I would soon learn that it mattered very much after it keeps happening. After some family realized I had made quite a few strides past where anyone really imagined I would be, they began to ask over and over and over. It was a painful but gut-wrenching lesson to learn that the ones who asked the most would never get it together. They simply would look to me as an emergency fund and continue to make bad decisions knowing I would bail them out.
Their conversations always started the same when I'd come around. "Hey man, let me holla at you a minute." Perhaps they would flag me down on the highway and say, "I need you to call me a.s.a.p. It's very urgent." I always knew that meant I need some money.
The second factor was that throwing extra money at people's financial mishaps tends to only make matters worse. Money is great at solving the problems it can and horrible at solving the problems it can't. When a person can't manage $15,000 a year, giving them another $5000 helps them none if there understanding of money doesn't change. Instead of them making five hundred dollar mistakes, they'll begin to make thousand dollar mistakes. It's the same reason that so many lottery winners are worse off in five years. If they didn't understand the money they had in the first place and millions are added to their level of responsibility it tends to be a disastrous mistake. Going to see a savvy tax attorney is one of the first things one should do with a new found fortune but hardly something that the winner of the Mega Millions would do.
In both of those scenarios I found that the problems evolved greatly around the lack of financial literacy. My family had never had anyone to "make it". There was a reason for that and it was because they simply didn't understand the fundamentals of money. I have to honestly admit that even after graduating from The Citadel with dual degrees in French and Business Administration it wasn't readily apparent to me either although I tried hard to understand it.
I was laid off for 20 months after earning nearly 80K a year from my IT job in my mid 20's. During the layoff, I found an $8 an hour part-time real estate, new home sales job and turned it into a multi-million dollar investment portfolio. During that time, I learned a lot about money especially how it applies to my family. The main thing was being rich is a mentality, but so is being poor. The family members who asked for money the most had a poor mentality in general. They were devout Christians who thought that God has the power to give them the desires of their hearts, which He does, but fail to realize that you have to work for it. I learned that there was no magic wand being waved and you earn within 20% of your closest friends. My family was never willing to change the company they kept which was poor pockets company.
Living well and having low credit card balances felt great to me and felt even better to my family. It wasn't until I answered one famous "Extremely urgent" call that I realized I had to turn things around. Protecting my future wasn't even the big thought that did it. It was actually someone's quick follow up to ask for more money. I decided to prolong the money getting to this individual by sending an out of state personal check that I knew they would have a lot of trouble cashing if any luck cashing it at all. They eventually did after a lot of work, and immediately after getting the funds they said, "The next time you send it, be sure not to do it that way again!" I said to myself, NEXT TIME?? Are you serious? No I'll pay you back, no, gee thanks I really needed it! But instead, they were already talking about next time.
At that point, I really began reassessing my giving habits and vowed I'd increase financially literacy to my family and beyond. I knew I wanted to bridge the gap between the haves and the have mores. Therefore, I wrote an award winning book on investing entitled Real Estate for Real People, created an investment club called The Investment Forum and began increasing awareness on the fundamentals of budgeting and investment analysis to hundreds. Today, I give workshops in equity and real estate investments, write monthly investment newsletters as well as give keynote addresses and breakout sessions on the powers of investing as well as the power of networking via a DVD I created entitled High Impact Presentations.
My motto is "From the mobile home to where moguls roam." To me that means I'm a success story in terms of making it out of the trailer park, but I'm providing my family and community at large a much greater service than simply doling out $20 here and $100 there. I'm advancing the power of home ownership by aiding with down payments on homes and adding generational wealth to many by teaching the powers of compound interest and how it works for you in company matched retirement plans. I have to admit that by nature I am an awfully generous giver but I have to remind myself that keeping the company of organizations such as the International Council of Shopping Centers (ICSC) and National Association of Black Hotel Owners, Operators and Developers (NABHOOD) and people such as J.W. Marriott means my commitment to myself is to one day own a hotel. With that type of goal, I simply cannot nickel and dime myself into oblivion because once I'm down, there are only few family members that can provide a limited amount of support to pick me back up.
My advice to other readers who may fall into this same trap of giving family too much money without any payback in return is to set aggressive goals that provide to the family's legacy and not just to individual's bad budgeting. Ensure that the family understands what it is you're looking to do for the future and enlist a few key stakeholders who buy into your mission and let them be the catalyst to help get your word out. If none of that seems to work, just say what they say when their kids answer the phone and it's the loans sharks on the other end asking for their overdue money, "Tell em I ain't got it! And don't say you can put something on it.
Anthony "Von" Mickle
The Investment Forum
