by Deborah Owens
Every year the Pew Research Center comes out with a study giving us a snapshot of how wide the wealth gap is between minorities and white Americans. The fact is that the wealth is so concentrated in the top one percent that we need to focus less on race and more on socioeconomics. There are a larger number of white people living in poverty then there are black or brown people. So I’m taking race off the table for purposes of this discussion.
The fact is that wealthy people think, act and manage their finances differently, which is why they get a different result. So let’s define what wealth is– Assets-Liabilities=Net worth and a positive number equals wealth.
- The first strategy every African American household should make is taking a portion of every dime they earn and making sure it creates another penny. It really is that simple. You can’t spend every dime you earn and expect to become wealthy.
Secondly, the report points out that the gap was narrowing as home ownership by minorities increased however, declining real estate values have wiped out the gains by minorities.
- We can’t afford to have all our financial eggs in one basket and the portion of our income that we use to create wealth needs to be diversified—-invested in stocks, bonds, precious metals or in our own businesses. People in the study who had diversified assets were not as negatively impacted by this economic downturn.
Next, since wealth has to be created we have to become entrepreneurial minded. The same talents that we use within organizations can create scalable businesses that are sustainable and create jobs. Business owners have the highest net worth in this country.
- Let’s develop a wealthy mindset, which views problems as opportunities for creating wealth in our communities. Model the behavior of many immigrant populations who come to this country with little or nothing and identify needs that they can fill to create wealth—restaurants, tutoring centers, drycleaners, etc. Our community is simply a market with needs that we can fulfill, make a profit, create jobs and ultimately create wealt
Finally, we have to develop what I call a “wealthy outlook” or the habit of adding value, which means exceeding expectations and doing more than what’s expected. There is apathy within our community that only we ourselves can address. Doing just enough will put you in the land of not enough. Wealth is not a McMansion, Mercedes and six-figure income. Real wealth is the ability to create opportunities for others through entrepreneurship, knowledge and innovation that can be transferred from generation to generation.
Deborah Owens is a financial expert who is on a mission to engage, enlighten and equip people of all incomes to build wealth. She is a twenty-year veteran of the financial services industry and a former vice president with Fidelity Investments. She is the author of Confident Investing and Nickel and Dime Your Way to Wealth. Her latest book, A Purse Of Your Own: The Easy Guide to Financial Security was published by Simon and Schuster and has been featured on CNN, ABC News Now, PBS, The Washington Post, The New York Times and Essence Magazine. Visit her website at https://deborahowens.com