'Money destroys families': Kevin O'Leary has hard-and-fast rules about lending cash to your loved ones — here are 3 paths to financial freedom (without relying on relatives)

Moneywise
'Money destroys families': Kevin O'Leary has hard-and-fast rules about lending cash to your loved ones — here are 3 paths to financial freedom (without relying on relatives)
'Money destroys families': Kevin O'Leary has hard-and-fast rules about lending cash to your loved ones — here are 3 paths to financial freedom (without relying on relatives)

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It can have the power to support a lasting family legacy, but “money destroys families, sometimes, when there’s too much of it,” according to Kevin O’Leary.

The “Shark Tank” investor shared his tactic for dealing with family members who want to borrow money from him during an interview on his YouTube channel with fellow entrepreneur Evan Carmichael.

“I say to them: ‘I don’t want to lend you any money. I’m going to give you money, and I never want it returned. But our contract between each other now is: you’re never going to ask again,’” O’Leary explained during the exchange, posted October 2020.

If you rely on family members for some cash handouts here and there — or you have people turning to you for financial help — you can avoid straining relationships with friends and family by following these O’Leary's lead on gaining financial freedom.

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Invest in yourself

O’Leary, 69, is a staunch proponent of investing in oneself.

In an Instagram post back last May, he wrote: “Never feel selfish for investing in yourself. Never apologize to anyone for trying to create a better life for yourself.

“The biggest reason I say to invest in your own future: no one else is going to do it for you. No one is coming to just hand you millions of dollars.”

That could mean getting a college degree, completing training courses or working with a mentor to improve your skills and advance in your career.

If you need capital to invest in yourself, you could consider a personal loan with Credible* to help take you to that next step.

Credible’s online marketplace lets you comparison-shop for the lowest interest rates* with just a few clicks. In just two minutes, you’ll see all the lenders that could help you fund your dreams with a single personal loan.

With no origination fees, service fees or prepayment penalties, you can be confident in the loan you choose and feel secure in your financial future, knowing that you won’t have to rely on family for funding.

On the other hand, if debt is standing in the way of your personal goals, you might consider a cash out refinance with Rocket Mortgage* to access your home’s value and make it work for you.

Rocket Mortgage is an online mortgage lender that offers a variety of home loans and refinancing options for your specific needs and goals and tracks your mortgage 24/7.

By opting for a cash-out refinance with Rocket Mortgage, you can take out a new mortgage* that’s more than your current one and pocket the difference. That cash can then be used to fund your personal goals so you can stand on your own two financial feet.

Read more: Retire richer — why people who work with a financial advisor retire with an extra $1.3 million

Save and invest early

It is important to start saving and investing your money as early as possible if you wish to find financial freedom, according to O’Leary.

During an appearance on Lewis Howes’s “The School of Greatness” podcast in 2021, O’Leary said he believes both high schools and parents should teach children about personal finance. He encourages kids to set aside a fraction of any monetary gifts they receive and learn to invest it. The earlier you save and invest, the more money you will have for your future.

One easy way to put your money to work — without the risk of investing in the stock market or other alternative investments — is to stash some cash in a high-yield savings account (HYSA). With a HYSA, you could earn more interest on your money and benefit from greater compound growth than you would with a traditional savings or checking account.

If you do want to invest, you don’t have to put a lot of money in at first. You can invest your spare change* and easily generate passive income through dividends without having to lift a finger. You can do this with the Acorns* app, which automatically rounds up the price of purchases you make and puts the spare change in a smart investment portfolio

All you have to do is link your bank account to the Acorns app and start spending. Sign up now and get a $20 bonus investment.*

Ditch the emotions

Try to keep money and emotions separate, O’Leary says.

In another Instagram post in April, he wrote: “If emotions are involved in a money decision, be very, very careful. No decision fueled by emotion ever led to long-term value.”

According to O’Leary, even rational people can make “horrible financial decisions when emotions are involved,” with long-lasting consequences. This is true in a business setting but also when making financial decisions with your family.

If you can keep your emotions out of your financial decision-making, O’Leary says that “could make a huge difference with money management.”

This may be hard to do on your own — you’re a human, after all — but Empower* could help make the task of separating emotions from money a bit easier with their professional financial guidance.

Empower is a unique digital suite of finance tools designed to help you stay on top of your finances — from investment strategies to budgeting and even wealth management. When you sign up for Empower, you can connect with one of their financial professionals* to help build a personal strategy with your unique financial goals in mind.

With a streamlined focus on finances, Empower can help you make important financial planning decisions without the weight of emotions creeping in.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

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