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Ifeoluwa Odunyemi: BLACK TAX

Have you ever heard of Black Tax? I guess you’re probably thinking that it means tax paid by black people.


Well let me help you out. Black Tax is that financial assistance rendered by an individual who has now completed studies and started making money through employment or business. This help is rendered to the community and extended family members mostly. This includes money for food, shelter, clothing and even education.


Black tax has its origin from South Africa and it’s a term now commonly used across the world.

In most African countries, a child is taught from a very tender age about togetherness and family success which rests in his or her hand. We hear words such as “remember where you are coming from”, “don’t forget your roots” and so on. Consequently, the family member who becomes most successful carries the burden of the less fortunate family members to ensure they succeed too. Sometimes, this is done willingly, other times the breadwinner has no choice.


With the recent popularity with which most Africans millennials migrate to other countries such as United Kingdom, Canada, United States and the like, the black tax has now increased more than yesteryears. At least 70% of individuals who have relocated for greener pastures send home a constant stream of black tax every month to support family members back home.


Is Black Tax entirely bad? No, it’s not. Why then is it important?


It is important to look at it because when not properly managed, it becomes a problem and robs one of building wealth.


You see, If I spend half of my monthly income on Black Tax, I might get into debt, and rob myself of the chance to build financial freedom early in life.


How then do I help my family without hurting my finances?


  1. Empower them – Teach them to fish. For example, if I have four siblings, I am responsible for in the university, I can empower them and in turn reduce the burden on me by teaching them about managing their finances. I will also empower them by encouraging them to start a business, develop a skill, so they can earn their income and the pressure on me reduces.


  1. Everybody does not need to know what you earn. Yes, I said it 😶, and it’s that simple.

Once people know or perceive you earn a certain amount, or that you are well-off financially,

there is a tendency for them to go overboard and ‘bill you’ without consideration.


  1. Budget! Budget! Budget! Personally, I enjoy having a budget of what needs to be spent or purchased for the week or the entire month. So, when I have a plan and I have earmarked a certain figure going towards Black tax, it helps put in perspective what I am spending and assist me to ensure I do not exceed what I have set for that purpose.


  1. Build an emergency fund- This is money that is set aside that can be used in terms of financial distress or economic lockdown like what happened in 2020.
  2. Learn to say NO! Nobody will beat you. If you cannot afford to foot a bill, please learn to say NO politely. I know this is not easy considering how the society is set up with lots of expectations, within a family unit. At the end of the day if you go above your spending limits, the burden of debt is yours to carry.


Ifeoluwa Odunyemi

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