12 Steps Black People Need to Execute W/ Their Money
The African-American wealth gap is its own pandemic.
The African-American Financial Dilemma
I was compelled to recently write the following article after a conversation with my financial mentor. She works in finance and conveyed how out of all the people she works with, Black people seemed to require the most repetitive education because they lack financial knowledge.
It’s no mystery that African-Americans tend to be on the bottom of the totem pole when it comes to financial independence, and we seem not to be catching up as quickly as we could.
Household Wealth for African Americans
Not only are 95% below the average household wealth of White Americans, but Black women also have to work a whole year plus eight months to earn as much as White men. If you can’t tell, Black people have some work to do, but it starts with our financial habits; this is where we can reclaim our economic power.
The 10 Things Black People Need To Do
The holidays catch everyone in the ass, and since African-Americans are already tremendously behind financially, we need to be extra careful about how we approach the holidays. Here are ten things you can do to benefit your financial health, and since I’m writing this around the holidays, I’ve included some holiday verbiage:
1. Avoid going into debt for any reason, including the following:
- Treat yourself shopping
- Holiday shopping
- Gift buying
- Traveling
2. Continue investing, or start investing if you haven’t.
Stock prices might be down or up during the holidays, but guess what? No matter the price of current investments around the world, it’s the best time to invest money or get started. Do you know why? There is never a wrong time to put your money to work for you on your behalf. Investing your money ensures your money will work for you 24/7.
3. Take a break from buying gifts this year.
The holidays don’t have to be about buying gifts — especially if you’re in debt.
Instead of using extra holiday cash flow to purchase gifts, shop, and eat out frequently, use the cash flow to save, invest, or pay down your debt. Trust me, whatever you’re going to buy will find its way of reappearing in your life at some point again (whether in its current form or a new and improved form later on). Perhaps, you won’t desire the item if you decide to wait, which means more money in your pocket.
4. Read a book on finance and educate yourself for the new year.
One of the easiest and sure ways to elevate your life financially is to invest in self-education. I’m not a financial expert, but I learned about money by reading books. I started reading them as a kid. Even though I didn’t understand every concept, I developed a deeper understanding of different concepts over time. The financial learnings I have accumulated since I was a kid have paid off, and I make it a priority to continue my financial education.
5. Don’t blow your money on your appearance.
The out-of-budget travel, clothes, shoes, car, house, hair, and nails can all wait until after you get yourself financially squared away. There’s no point in looking the part if you’re not financially the part.
A pretentious, showy life is an empty life; a plain and simple life is a full life — Proverbs 13:7, MSG
Some who are poor pretend to be rich; others who are rich pretend to be poor. — Proverbs 13:7, NLT
6. Don’t pay extra fees to get your paycheck in advance.
Learn how to live comfortably, not paycheck to paycheck. Don’t fall into the trap of spending everything you have, running out of money, and overly anticipating the arrival of your next paycheck to the point where you pay extra fees to get the next paycheck early. Please don’t be this person.
Here are three things you can do to help you immediately:
- Slash your expenses, optional spending, and cost of living.
- Start investing so you’re money can go to work for you.
- Increase your income (e.g., get a raise, start a side gig, or get a part-time job).
Stop living paycheck to paycheck.
7. Instead of eating out and putting junk in your body often, eat in.
Eating in saves a shit load of money, not to mention it could also decrease the wear and tear of your body since you’re probably putting in fewer junk ingredients than fast food places dump in their food. Eating in is an excellent way to save money and your health in the long term.
8. Stop giving in to impulse purchases.
Sometimes it’s best to stay home and off the online stores on your phone, so you don’t tempt yourself to buy things you love at first sight but won’t need at the end of the night. Stores make a living off impulse buyers; they f*cking love them. Don’t let impulse buys be why you are always in a tight financial spot.
9. Start Budgeting.
I know people hate it, but budgeting works! It’s okay if you hate doing something beneficial as long as you still do it. Budgeting saves people’s financial futures. Create a budget today, allocate every single dime you bring in, and stick to the budget by implementing something called: self-discipline.
10. Take notes from what isn’t working.
My family didn’t demonstrate the best habits with money, and guess what, their previous families didn’t have the best habits with money either. And the same thing goes for the previous generations.
If there is one thing I’ve learned, the best lessons are learned from watching others. If something isn’t working for someone else for generations, take action, and do something different.
11. Don’t count on social security or other government funding.
Take financial matters into your own hands. Don’t depend on the government for handouts. Create your independent financial future.
12. Build your 3–6 month emergency fund.
Never be unprepared for a genuine financial emergency (e.g., large unexpected medical bill). It might take a lot of time or not a lot of time to build an emergency fund, but I promise you won’t regret it when that unexpected expense shows up at your doorstep.
Be an African-American who goes against the grain and has their financial shit together. Then, help your other African-American counterparts do the same.
Destiny S. Harris is a writer, poet, entrepreneur, teacher, and techie who offers free books daily on amazon. Destiny obtained three degrees in political science, psychology, and women’s studies. Follow her on Instagram, Facebook, or @ destinyh.com
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This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any significant financial decisions.