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How the Black Tax perpetuates poverty and how to beat it

Most of us are being held back financially by something known as The Black Tax. If you don’t know what the Black tax is, let’s break it down for you. 

The black tax is a situation where your finances are expected to not only take care of you and your immediate family but also your parents, your siblings, your extended family, and even your close friends.

Sounds familiar? Of course, it does! If you’re Nigerian, or even African, you are familiar with this situation. It’s one that is common across African cultures, due to the way our family and blood ties are structured. You are expected to take care of your family, and the definition of family seems to be stretched as far as your resources will allow it. It’s called Black Tax because it’s common to African cultures, although it’s not unique to us. 

The challenge of black tax is that it puts one into a sandwich, that is, your resources are taking care of two generations, your children or a young family on one side, and your older relatives or parents on the other. We say resources because its often not just money, it’s also time, attention, emotional support and more. 

If the black tax is not well managed, it becomes a huge drain. What usually happens is that the generation in the middle finds it impossible to save for their own future because they spend all their resources on their older relatives. So by the time they get old and stop working, they have nothing saved and in turn are forced to rely on their children who are often starting families of their own, thereby perpetuating the cycle of poverty and financial struggle. Many of us are watching our financial futures disappear into a black hole of never-ending family obligations. 

How Does One Break This Cycle? 

  1. Understand your circle of responsibility – If you gave birth to them or they gave birth to you you have responsibilities towards them. Everyone else, barring any unique circumstances, you’re not primarily responsible for them. You may have some requirements to help here and there but not the primary responsibility, so only help when you’re able to. If you’re not able to you’re not able to, period. It’s not like you can help everyone with everything every time. 
  2. Understand your means, very well – Sometimes you help because you think you have the means, only to run out of money less than a few days later and wish you could go back and undo that help. That’s because most of us define our means based on what is in our accounts RIGHT NOW. What you should be doing is weigh your means as what is left after you deduct all your existing bills, day to day expenses and the portion of your investment.

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