Welcome to reThinkable - my Sunday newsletter where I share actionable money tips, strategies, and resources to help you make smarter money moves.

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Are your family or friends holding you back financially, friend?

This is a hard question.

Most of us were raised to put family first.

Even Stitch said it: "Ohana means family. Family means nobody gets left behind or forgotten."

So when someone you love needs help, you help.

But what happens when that one time $500 to help your best friend with bills turns into two times, then three times?

What do you do when your cousin can’t hold down a job and keeps asking for help with rent?

And how do you say no when your friend needs another $300 because their car broke down again?

Turns out you’ve become their emergency fund.

And that can be draining, financially AND emotionally.

My friend Aisha told me how her parents struggled with this for years. They came to the US around 30 years ago and sent money back home to help their extended family.

At first, it felt good. They were helping, and the family was grateful.

But soon, it was always something: a roof collapsed, someone lost a job, the economy was bad…

A few years later, they traveled back home, and realized half the “emergencies” weren’t really emergencies at all. Folks had just realized asking for money was easier than solving their problems.

After that, Aisha’s parents got more comfortable saying “no.”

Some people got upset, but the lesson was: there’s a difference between helping someone and enabling their financial irresponsibility.

So today I wanted to talk about the difference, and 3 ways you can actually help.

Helping vs Enabling

Helping someone through a money crisis is about getting them back on their feet.

Enabling someone’s financial irresponsibility is stepping in so often they never have to stand up on their own.

An easy way to tell the difference is to ask yourself:

Is this money helping them solve the real problem, or just avoid it?

Let’s say your best friend is between jobs and is asking for $500. She’ll use that money to pay for daycare so she can start at a new role and earn her first paycheck.

In this case, your money is 100% helping her solve the problem. It gives her the time to go to work and earn the money she needs to be self-sufficient. 

But if she’s been “in-between jobs” for the past year, doesn’t have a clear plan, and keeps asking for more… That's a different story. 

Here are some common situations:

If your money is allowing someone to stay stuck in a bad situation, it’s time to make changes.

3 better ways to help

There are ways to help a loved one without completely draining yourself in the process.

1. Non-Cash Assistance

Money isn’t the only way to help. Sometimes your time, connections, and knowledge are the most valuable things you can share.

If you’re on a tight budget or have helped them before, you can:

• Review their resume and help them job hunt

• Help them set up a budget they can stick to

• Get them in touch with a reputable debt relief program

2. Indirect Cash Support

This can be especially helpful if you’re dealing with someone who struggles sticking to a budget. You don’t want to feel like your money is just disappearing into a black hole. 

Instead of handing cash directly, you can:

• Add them on your cable/internet plan

• Pay utility bills directly

• Give them a gas card

This can support the other person by making sure the basics are covered.

3. A 1-Time Emergency Fund

A 1-time emergency fund is when you set aside a specific amount of money to help them, but once they used up, it's done. 

You can say something like:

“I can set aside $2,000 to help you this year. Once that’s gone, I won’t be able to help anymore.”

This way you’re setting some limits without completely cutting someone off.

At the end of the day, all of these strategies are about boundaries.

You have to know how much you can actually help, and what kind of help you’re okay with giving.

It’s easy to feel like the bad guy when you say “no” to someone you love.

But boundaries aren’t selfish, they just make sure you’re taking care of yourself too.

To making smarter money moves,

— Vincent Chan

Cool things I found this week

• Smart Money Tip of the Week: These are 5 jobs that produce the most millionaires 

• Ever feel “guilty” taking vacation? Here’s how to stop that silliness

• Millennial can’t even afford having a midlife crisis anymore

Vincent Chan

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