Skip to content Many people have not been able to build wealth and achieve financial independence despite earning well because they are victims of the Black tax.
Black tax is a term used by members of the Black community across the world, but it also resonates with other ethnic groups. It refers to regular payments given to family members, to help support them financially.
The Black tax is often perpetuated by the cultural belief that it is the payer’s social responsibility to support those other family members. The payers could be the firstborn, the most successful child, or the one who lives in a more affluent city or country. Accordingly, the payer often works tirelessly day and night to meet not only their own needs and those of their immediate family, but also the financial demands of their extended family. They sponsor the education of their siblings, nieces, nephews, cousins, and in-laws. They send welfare money regularly to their parents and elderly relatives – building houses for them or paying their rents, paying for their healthcare needs, and sponsoring their social events such as a wedding, funeral, or vacation among other expenses.
The challenge with Black tax is that the people ‘paying’ the tax are not yet financially free themselves yet they are taking on additional burden. Oftentimes, they are only slightly better off financially than those they are sacrificing for. As a result, they are depriving themselves of the money they could have used to build wealth by diverting it to support the consumer needs of their relatives.
The second challenge with the Black tax is that the money given is often spent by the receivers on consumer needs rather than on empowerment schemes. Accordingly, this keeps the beneficiaries dependent on the payer longer than necessary. Worse still, this dependency element tends to breed a sense of entitlement or even irresponsibility in many beneficiaries because they have become used to it.
While there’s nothing wrong with helping others, including family members, it should be done sensibly. If you are a Black taxpayer, it is important to prioritize your own financial freedom first. It is easier to lift others out of financial hardship when you are financially secure than for one struggler to rescue another struggler. If one financial struggler is trying to help another financial struggler out of the pit, both of them will fall into the pit.
In as much as it is helpful to support your extended family, it should not be at the detriment of your immediate family – your spouse and children. Whatever you do, don’t be a victim of the Black tax syndrome.
I’m Ayo Adebamowo. Author, Speaker and Tech Entrepreneur. I’m here to walk your success journey with you. Subscribe to my newsletter for regular nuggets or check out other empowering articles on my blog to help in that journey. My latest book is Business Accelerators, a primer on launching and growing a profitable business.
Written by : Ayo Adebamowo
About the Facilitator – Ayo Adebamowo Ayo Adebamowo is an Author, Speaker and Tech Entrepreneur. He is the founder of MyMedicalBank, a health technology company promoting digital access to healthcare through creating innovative digital solutions.
A Nigerian-British national, Ayo has been named as one of the 70 Most Outstanding Healthcare Professionals in the United Kingdom.
Having started and run various businesses himself in healthcare, technology, agriculture and publishing, Ayo very much understands from a practical point of view the pains, struggles and mistakes aspiring and established business owners often make that delay their success. He therefore brings his wealth of experience coupled with years of experience and research to help other entrepreneurs succeed in their journey.
