My day job for the past 15 years is that of a sales trainer. I teach salespeople how to overcome objections and how to Start Selling with the word, “no.” For years I’ve instructed them to not cease their persuasion until they’ve heard their customer tell them “no” four times (though recently I’ve toned that down to hearing “no” twice, at that point the salesperson should refocus the customer or stop entirely).
This article my dear readers, is diametrically opposed to the everyday teachings of my career. I want to explain the Art of Saying No! Whether you realize it or not, as you accumulate wealth for retirement you will have a target on your back. Family members, friends, co-workers and acquaintances, they all desire to advance their own agenda. They’ll subtly ask for a loan (a hand out!) or possibly approach you about an investment idea (using Your wallet to fulfill Their dreams!). They’ll take advantage of you being a nice person, share their hard luck story with you and pull at your heart strings. Just say No.
Allow me to describe a hypothetical scenario. Your dear sister is married to a dreamer (or a gambler, or a dead beat, it doesn’t matter, just follow along). You’re at the point in life where you’re well on your way to financial independence. Your sister and her husband (with numerous kids) have never gotten their shit together financially. She approaches you for a bailout request. She (and he) are in a sad situation. They never seem to get ahead. Providing them a loan will hurt them and your relationship with her, more than you know. It would be like offering a hundred dollar bill to a wino on the street. Just say No.
A friend of yours (this happened to me three years ago, true story!) is a chef and is in the process of opening a new restaurant. He’s asked you to join in as a silent partner. All he needs is a remaining $50,000. to finish it out and buy inventory, AND He’s willing to sell you 25% of the new business venture. On paper it sounds great, almost a no-brainer! He’s a talented chef but unfortunately, a horrible money manager. The restaurant opens with fan-fare, receives great reviews but closes down inside of eight months…. I should have just said No!
Not everyone is out to get you, but you are thought of as a convenience to those friends and loved-ones. You see, the road to Hell is paved with good intentions. Just say no. Trust me, loaning money to a friend will destroy that friendship. The only possibility is to approach this as a business, charge them interest, demand collateral, and draw up a promissory note. This would be the ONLY acceptable way to loan a family member or friend, money.
A very dear friend of mine’s wife was recently diagnosed with breast cancer (by the way, she’s been treated and she’s doing fine), we were having coffee and he explained that the annual deductible exceeded his emergency cash savings. He never asked me for a dime, but I volunteered (I’m an inherently nice, empathetic person, I’m not a asshole) to loan him the money he needed to meet his deductible and to get her into treatment ASAP with complete peace of mind. I had three stipulations; 1) We had to draw up a legal promissory note, 2) He would pay me 2% interest on the loan which doesn’t come due for 12 months, in one lump payment, with no extensions, and finally, 3) He was to hand over his Rolex, box and papers as collateral. He was astounded I made this offer as his family wasn’t financially able to help him. His words to me, “when you’re down, you quickly find out who your true friends are.” (This brought a tear to my eye because I love this Guy).
I wanted to help my friend out, I wanted his wife in treatment immediately and I didn’t want either of them to go through this with more stress than they were already feeling. I guess in a small way I rescued them. Keep in mind I approached this as a businessman. I was willing to help them out but I needed to cover my backside as well, hence the collateral. The interest I charged is the going rate for a 12-month CD. I felt this was fair and not at all usury.
My Friends, as difficult as it is to turn loved-ones away, learn to say no. Don’t use your wallet as a means for others to fulfill their dreams, or build their business or pay off their debts. You’re not a bank and you’re not a charity. If you want to give freely and willingly that’s an entirely different matter and I respect you for that. This blog is about building YOUR future, accumulating wealth so that you can become financially independent and retire early. Saying no ensures that future for You. I believe in being charitable and I also believe in paying tithe to Church (paying our first-fruits to Him). However, if you don’t learn to say no, you’ll impede your ability to grow, and to be on FIRE…. Just say no….