The Black Tax
Black tax is generally understood to be the financial pressure that most young, black professionals have when it comes to supporting or helping to support less privileged family members.
It is NOT this:
Although my definition may not be perfect, it encompasses how I understand black tax currently. There is a reason why its called black tax is because the financial pressure to support the family is felt mostly by black people. Traditionally this has been because of wealth inequalities, history etc.
As a relatively ‘recent graduate’ in my second year of full-time work, I have felt the pressures of black tax. From the unspoken expectations for groceries, clothing to help even distant relatives (that I don’t know all that much about) – amongst other things.
I have come up with 3 things that I do to help me deal with this as best I can:
How to manage black tax
I say No when I can’t help
There are times when I am requested to help with certain things. Whether that is groceries or clothing: if I am at a place financially that I am unable to help or helping would mean going into debt then I understand that I can’t and say no.
Having a clear understanding of where I stand financially has played a big part in making it easier to say ‘no’, believe it or not, if you’re reading this, you’re probably an adult, which means you can say no.
Budget
Budgeting has put me in the driver’s seat, literally, every time I am about to receive any money, I sit down and decide what each rand will do.
With this ritual, black tax or ‘Family’ – as it appears in my budget, is a line item, split into two categories, short and long term that way I save/invest a potion on my earnings towards ‘black tax’ and this makes it way less of a burden.
Change perspective
The purpose of black tax is for black families to help each other. This is a great goal – one that has enabled me to go this far in my life. However, I think black tax should be thought of in two ways, that is, immediate needs vs long term needs.
I focus more on long term needs because I know that planning and investing for that will help to start growing intergenerational wealth and one day getting rid of ‘black tax’ altogether.
Taking into account the unemployment rate in South Africa now which is currently sitting at around 30%, the low wages and so on, I am somewhat privileged in that I have employment with a reasonable salary. This affords me the option to budget for black tax.
If you are in a space where you could do the same, give it a try, you definitely won’t regret it.
Author: Thando (@itsthandondlovu)
My name is Thando, a young working professional in the city of Cape Town. I love personal finance and a proud member of the #FIRE movement ( Financial Independence Retire Early). I tweet my opinions and thoughts on personal finance.
