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Money strategies for the savvy Black woman
Ebony, March, 2004
SISTER, can you spare a dime? If you re smart about your money, you probably can. But if you're like the millions of Black women out there to whom financial fitness is a mystery, you're probably working overtime to make ends meet and feeling the stress of living paycheck to paycheck--one layoff or medical catastrophe away from a complete financial disaster.
It's past time for you to take your money matters into your own hands and knock down any and all obstacles that stand in the way of your opportunities to build wealth and create a financial cushion. Financial fitness may be new to some of you, but now is your chance to make it a stress-relieving reality.
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"Nobody teaches us this stuff," says Lynnette Khalfani of West Orange, N.J., syndicated financial columnist and author of Investing Success: How To Conquer 30 Costly Mistakes & Multiply Your Wealth! "Our generation has so many more advantages and access to information that the opportunity is there for you to take control of your life."
Financial experts say that the main obstacle to wealth for Black women in particular is that many Sisters can't think beyond the next pair of shoes or getting that money order to pay the bills.
"The biggest thing is lack of knowledge and understanding the role that personal finance plays in your future," says Gwendolyn Kelly-Gautier, education and community relations director for Consumer Credit Counseling Services, a division of Money Management International. "The solution is to become more educated about your own financial matters and change your attitude about money."
Start with the basics by finding a bank that will compete for your business.
Khalfani suggests that you start locally and establish a relationship with bank personnel who will work with and for you. Figure out your primary banking needs. Do you need a checking, savings and/or money market account? Are you looking for a financial advisor to help you meet your short- and long-term financial goals? Find the bank that offers the most for your money--free checks, consultations and seminars. You want a bank that values you as a customer.
Also, beware of hidden charges. Some banks charge fees if you go below your minimum balance. Other financial institutions charge you for that handy debit card. Be sure you know the cost before deciding on your money matters.
Once you've found a bank that meets and exceeds your needs, it's time to start thinking about and understanding credit. What does it mean when you get that credit card from your favorite boutique or department store? How long will it take to pay off that balance?
Before you sign up for a credit card, understand how credit can work for and against you. If you pay off your balances each month, you're establishing a strong credit history that can aid you when you apply for a home or car loan. If you're carrying a high balance or are late with payments, you're probably costing yourself thousands of dollars in unnecessary interest. As debts mount, your financial life tends to get put on hold, and that can lead to crippling consequences.
As you begin to understand banking and credit, it's time to branch out and invest for your future. Black women are generally conservative when it comes to investing their money, whether it's in a 401(k) or other retirement plan, stocks, mutual funds or bonds. There's nothing wrong with playing it safe. Find investment companies or financial planners that can take the financial vision you have for your life and put your money toward meeting and/or exceeding that vision.
For too long, Black women have been left out of the great wealth-building opportunities that gave us our first two Black female billionaires--Oprah Winfrey and Sheila Johnson--in less than a year's time. For too long, Sisters have placed their financial futures on the back burner in favor of the here-and-now, as in "here's a great new outfit" and "now I need a new purse."
It's time for Sisters to learn from their money failures of the past and put their hard-earned money to work for their future. "Our ultimate goal is to take our experiences of the past and create a new and better financial life," says Kelly-Gautier of Baton Rouge, La. "We need to be reeducated and reconditioned in our thinking about money."
COPYRIGHT 2004 Johnson Publishing Co.
COPYRIGHT 2004 Gale Group
