here to discuss more. Alfred Edmond junior senior vice
president and executive editor at large of black enterprise.
Thank you so much for joining us when you hear
those numbers. It is evident that this is a
huge gap. Talk to us about the barriers that
black households face when it comes to building wealth Asia
. This is a great topic to talk about when
we talk about juneteenth because juneteenth really is about unfinished
business. We know that in texas they found out
later that that the emancipation proclamation ended slavery began unfinished
business. But what we have here is a racial
wealth gap that was created because being freed did not
include economic inclusion. So the racial wealth gap didn't
just come up overnight. The system was built,
the system that undergirded slavery also blocked black people from
everything from owning homes, owning land to entering the
financial markets to buying stocks and bonds and the remnants
of that still exist today. So it really is
an important topic to focus on, not just for
black americans but for all, americans are seeing juneteenth
as a, as a chance to address unfinished business
of economic inclusion in America. Yeah, it's also
worth noting just the power behind black spending, black
spending power reaching a record$1.6 trillion 2021. While
net worth among African Americans fell over the last two
years. How do you think people can reframe their
spending to either re circulate dollars into the black community
or save more. Well, what we have now
today is it's a lot easier to target spending with
black-owned companies. Black-owned businesses in part because of social
media, in part because of the targeted marketing that
small black-owned businesses can do to really reach their customers
to be visible. So spending more with black-owned business
is an important part. But we need to be
clear, you're not going to close this huge more
than 10-1. Um, depending on whose numbers you
believe racial wealth gap simply by spending more black owned
businesses, we need to think about investing more in
black owned businesses. We need to challenge both um
public government and corporations to invest in the growth and
the scale of black owned businesses so that you have
a kind of a force multiplier effect when it comes
to jobs and capital creation. So spending more black
people spending more with black businesses is only part of
the equation. Yeah, I'm really glad that you
point that out, especially as we've seen, corporations
kind of trying to navigate this new landscape with juneteenth
as a federal holiday. What do you think everyday
people can do to hold these corporations and also the
government accountable for these kinds of investments? Well,
again, we know we're coming through this period,
the post George Floyd murder window, if you will
, where a lot of corporations, corporations made pledges
to challenge economic and systemic racism and equity, juneteenth
is a perfect time to say, listen, yes
, the emancipation proclamation, juneteenth was a beginning of
creating freedom for african americans, but we know that
freedom is not complete until we have economic equity and
corporations are stepping up to say, okay, we're
gonna invest in black owned businesses, we're gonna create
capital for black owned businesses. We're gonna, we're
gonna educate black people more and provide more resources around
everything from credit management to mortgage lending. So it's
about reducing the barriers and pouring more money into black
businesses and black communities. Yeah, Alfred I want
to take things back to black families during this time
as well though, we know we talk about it
every day now on cheddar, just the higher prices
of everything from grocery stores to the gas pump.
And I'm wondering if you have steps that black households
can take to improve their financial well being, especially
right now. Well, in the short term,
it's very important to limit debt. If not reduce
debt. Obviously debt and the interest payments you make
on on debt payments eats into your spending power eats
into your ability to save. The second thing is
really to be serious about saving and you got to
be serious about saving all the time, not just
when prices are going up. If you're serious about
saving, when prices are low, then you actually
have more resources to carry you through. When prices
go up, wealth building is a long term game
prices are going to go up. Sometimes prices are
gonna go down the economic system and the economic winds
will blow in different directions over time. The key
to wealth creation over time is to stay committed to
asset accumulation, consistent saving and consistent control of your
debt so that you can ride out these um up
and down economic, uh you know, trends.
We also know we've been following the Fed announcements really
closely interest rate hikes leading to pressure on housing market
and mortgage rates. And we think about home ownership
as a major gateway when it comes to generational wealth
. What kind of investments do you think black families
can be looking to during this time again, when
it comes to making those investments for the long term
, not just for this generation, but beyond.
Well, there's the two things you always want to
remember is diversification and delayed gratification. Here's what I
mean, there's no single investment, that's the investment
for an inflationary time. The key to wealth creation
is to have, You know, a variety of
investments ranged from stocks, bonds, real estate,
you should be maxed out in your 401K. Plan
to give access to any kind of retirement savings plan
so that you have different assets spread across different asset
classes because in different economies, certain assets gonna do
better than others. So you need to have a
balanced portfolio and you need to have a financial advisor
to help you to understand how do you balance out
that portfolio? But the key here is to remember
again, it's a long term game. I always
tell people maybe this isn't the right time to buy
a house for example. And home ownership is a
key key foundation to building wealth. Well, you
should still be budgeting and saving for that down payment
for your home, even if you think the prices
are too high for you to actually afford one right
now. So the time now is the right now
when home prices are very high to start budgeting and
putting aside money towards your down payment and other home
home cost so that wind prices come back down and
they will, you'll be ready, you'll have the
money put aside so you can't wait until the prices
come down to take advantage of opportunity. You need
to be doing that now offered last question for you
. Um, you know, as we talked about
earlier, social media is a huge tool in our
arsenal when it comes to education and awareness, just
getting information out, especially when it comes to finances
. How do you hope that this generation uses social
media as an educational tool to building awareness around financial
futures? Well, I'm very, very encouraged by
that because we're already seeing it, especially with generation
the millennials, generation y and generation Z. They're
absolutely engaging and sharing financial information on social media.
There are more financially savvy than previous generations as a
result they follow black enterprise for example, on instagram
facebook live linkedin on our Youtube channel where they get
exposed to not only information but other experts and finances
. People like Ash, cash exam test, Keyshia
and Williams. I could drop tons and tons of
names but you got a whole generation of young people
I would say millennials and younger who are now not
only learning, but they're sharing it on their social
media platforms. And that's very, very encouraging.
So you can really get a good education as anybody
. Any age group by just following certain accounts on
social media, go to black enterprise dot com.
Follow black enterprise on social media and you'll get connected
to a whole army of people who can be a
big part of your financial education. Such good information
. Thank you so much for joining us. That's
Alfred Edmonds, junior Senior vice president and executive editor
at large of Black Enterprise.