When Penny Campbell got divorced and started having financial trouble, she asked her older sister Lisa Griffith if she could move into Griffith and her husband's Texas home temporarily in order to get back on her feet.
That was six years ago.
Though Campbell has been trying desperately to become financially independent again and has moved out several times, she's always had to move back in. Now, she's something of a permanent fixture in the Griffith family, paying a small amount of rent while she finishes school.
Regardless of her intentions to the contrary, Campbell has become a financial freeloader, according to "Good Morning America" financial contributor Mellody Hobson.
How do you say no to family or friends that seem to need your help? It's a sticky situation, but Hobson stopped by "GMA" to show how you can first spot the freeloaders and then how to deal with them effectively, without abandoning them.
Freeloading? The Sisters Campbell and Griffith Under Stress
When Campbell struggled through divorce and devastating financial setbacks, she fell back on her sister for support.
"I'm lucky I have family to turn to, through the good times and the bad," she said.
But soon things got so bad financially that she had to leave her three children and father in Montana and relocate to Texas where Griffith lived so she could move in with the couple and their 17-year-old son and save money.
"I don't want her to fail at all," Griffith said. "She's very smart. She works really hard. I didn't want her to worry about those finances, but live here for financial reasons."
Despite working a full-time job in law enforcement and working part-time at a local department store, Campbell has not made any progress financially in the six years since she moved in.
"I haven't been able to save any money. It's one of those things where I look at my paycheck and I'm like, 'Where did my money go?' I know I get paid this amount a month, and by the end of that paycheck, it's already gone," Campbell said.
But Campbell's not the only one getting frustrated; Griffith is also feeling the growing strain.
"I feel like she does take advantage of us sometimes," Griffith said. "Being a family member, she feels that she can be late on rent and not communicate that she's going to do that... She just becomes so defensive. I approached her, she didn't approach me."
Campbell asked her sister if she could stay in the home until she finishes school, about another nine months.
"I didn't want to do it, but I thought what's another year almost, nine months, whatever," Griffith said. "And so I said that's fine. If that's what you got to do, that's fine."
Mellody Hobson on Financial Freeloaders
The financial situation is tearing at the sister's relationship.
"It has affected our relationship in a negative way, in a way that I wish wasn't there," Griffith said. "I want her to have a great life. That's all I've ever wanted for her."
"I get frustrated because I am not at the point where I thought I would be," Campbell said through tears. "If I sat here and said I'm not doing anything to turn it around... but I am."
According to Hobson, the first thing to know is whether a family or friend has become a freeloader. There are several warning signs.
Picking Out the Freeloaders
He or she repeatedly comes back for money.
If the same person is constantly coming back for money, or in Campbell's case relying on her sister for six years, Hobson said they are freeloading.
"When you're dealing with someone where it's a repeat situation…you've got to say no," Hobson said. "It's very, very difficult, but you need to say no."
Someone who is truly in need will ask for help once or twice as a last resort and then figure out a way to make ends meet, she said.
He or she buys luxuries instead of necessities.
If a friend or relative uses your money to buy things that they want but don't need, they definitely crossed the line into freeloading, Hobson said.
He or she acts like a victim.
Another way to spot a freeloader is to see if they seem to have stopped helping themselves. Hobson said if they start acting like a victim and only feel as though other people can solve their problems, then they are freeloading.
In that situation, Hobson says, "you've got to put the ball in their court and have them take control of their life."
Dealing With a Freeloader
After you've identified your freeloader, you need to take steps to curb their freeloading habits, Hobson said.
Set clear boundaries on help.
First, tell whoever you're helping exactly how you're going to help them. The person who you are helping should be able to say exactly why they need the assistance and what they're going to do with whatever help they get, Hobson said. For Griffith and Campbell, Hobson suggested sitting down to communicate frustrations.
Jeopardizing your relationship is "just not worth it," Hobson said. "Talk about these issues openly."
Don't go into debt helping others.
While Hobson said she would not suggest turning down everyone that asks for help, you have to be careful not to enable those you do help. It's definitely time to stop when your help is more than you can afford, she said. Both of you going into debt is the worst case for everyone involved -- "you can't put yourself in peril."
Helping a Freeloader Become Financially Independent
There are two major things you can do to help make sure a freeloader doesn't need your help in the future: give non-financial help and develop a financial plan with them.
Give non-financial help.
To help a freeloader get back on their feet, you can help by finding out what their goals are and how they are going to achieve them, Hobson said. Paying for a resume or a job hunting seminar can pay off if they're out of work. Whatever it may be, it's important to provide them the tools to get back on their feet.
Help with a financial plan.
A financial plan can help organize your freeloader. According to the financial planning Web site Simplifi, only 5 percent of Americans have a written financial plan, but they have found that if you have a written plan, you are 250 percent more likely to achieve your financial goals.
"If you are going to give [someone] money, put it in the form of a loan," Hobson advises. "That will help the situation and help them take responsibility and accountability for what is going on."
It may seem like special circumstances when the freeloader is your child, but according to Hobson, establishing boundaries is still important.
If they have a job but are living at home, they should be paying rent, she said. Beyond that, consider charging a maintenance fee or requiring that they help out with household chores.
Hobson doesn't recommend these measures purely for financial reasons but also to teach responsibility, she said.
Since "GMA" visited Campbell and Griffith, the situation has changed.
Penny Campbell has moved out and gotten her own apartment.
"She felt she needed to make a change," Hobson said.