This is the second installment of black Prosperity in River East. Earlier this week, Michelle Singletary, syndicated personal finance columnist with the Washington Post, delivered a Black History Month presentation at my agency. The title of her presentation was “Are you in the Black?” Her points were so powerful that I will share some of them with you in this post and incorporate my observations in River East. To put this blog post in perspective, please let’s refer back to Dr. King’s Mountaintop Speech April 3, 1968:
“Individually, we are poor when you compare us with white society in America. [But] Never stop and forget that collectively we are richer than all the nations in the world, with the exception of nine. Did you ever think about that? After you leave the United States, Soviet Russia, Great Britain, West Germany, France, and I could name the others, the American Negro collectively is richer than most nations of the world. We have an annual income of more than thirty billion dollars a year, which is more than all of the exports of the United States, and more than the national budget of Canada. That's power right there, if we know how to pool it.”
The problem: 42 years after Dr. King's speech, us black folks STILL haven't figured out how to pool our money and create wealth! Here are some suggestions:
1. Stop Attending Colleges we Can't Afford
We all want to show off and challenge ourselves by attending old guard private universities. Unless you're independently wealthy, chances are your mama took out loans, your grandmama took out loans, and you worked part time jobs to make ends meet. Nonetheless you still graduated with $50,000 in undergraduate debt. In my opinion, it's not worth it. We need to encourage our younger brothers, sisters, cousins, and proteges to keep it real and attend a school he/she can afford with scholarships.
2. Stop Spending Money on Dumb Shit
We, especially black women, spend too much money on dumb shit. Dumb shit includes, take-out food, acrylic nails, fake eyelashes, cash checking fees etc. Like Dr. King said, we're poor people independently, but collectively we have enormous buying power. But of course, instead of creating wealth within our own community, we're making non-River East business owners like nail salon owners and CashPoint proprietors filthy rich! Don't let the dilapidated storefronts fool you. These folks are laughing all the way to the bank while we remain at the bottom of the economic ladder for another 42 years!
Here's an example of how cutting back on dumb shit can help us build wealth: many of my girlfriends get their hair and nails done every two weeks. The chart below uses very conservative figures. Let's assume the hair appointment costs $45 and the full set of acrylic nails costs $20 for a total of $65. As you can see, if my girlfriend continues with these personal grooming exercises every two weeks, after 40 years, she would have spent $63,960! If she passed on the grooming and saved the $65 in a basic savings account at 1%, she would have earned $79,348. If she invested the $65 in a money market account at 5%, she would have earned $208,852.41! This doesn't mean we cant treat ourselves to a new doo. But it does suggest we stop doing things that don't add value to our lives or our bank accounts. I get my hair and nails done once a year. Once. And I think I look OK. I'm sure we all would look just as beautiful (or even more beautiful) without spending money on all the dumb shit.
4. Stop buying things we can not afford to impress people who are just as broke as we are.
This clip from Saturday Night Live says it all! -- takes a second to load but it's worth it!
1. I will not allow my siblings or cousins to become slaves to the Student Loan Corporation by attending colleges they can not afford.
2. I will not spend money on dumb shit.
3. My job is not my credit. I will not pay interest on depreciating assets.
4. I will not buy things I can not afford. I don't have to impress my linebrother because he's just as broke as I am.