The aftermath of Rihanna’s Fenty Beauty collection is an indication that more and more, businesses are scrambling to capture black women’s attention by marketing a diverse line of products. I can’t in good conscious give these brands the pleasure of being listed, so here’s a slow clap for effort.
Thanks Rih for doing it right and doing it well. We appreciate you, sis!
The beauty industry has taken note and we’ve increasingly seen more representation in ad campaigns, our time spent searching for tailored products has decreased, and there has been an upswing in the availability of products and business that are for us and by us.
However, beyond the beauty industry looms a lucrative cohort of services that we hardly hear about and rarely seek.
The financial services industry, foreign to us – women, other marginalized groups and socioeconomic statuses alike – has all but explicitly banned us from the knowledge and practice of wealth building. As if we do not exist nor deserve the opportunity to build wealth.
Black women carry much of the $1.3 trillion in spending power that Black people hold. This metric is not an indication of wealth. Spending power is the money one has in hand to buy products and services. A majority of us do have cash under the mattress liquid assets, so much to cover the minimum opening balance (MOB) for an investment account required at most traditional financial institutions (average MOB of $15,000). Further, according to a recent study by Neilsen on the consumer behavior of Black women, we rank above the average on having the “behavioral and attitudinal traits that indicate us as good customers for the investment and financial services industries”.
And yet…
when was the last time you had a financial advisor call you with a pitch to take you on as their client?
We are the most educated group in the U.S., elevating our power to make household decisions that we didn’t make historically (i.e. home buying, car buying, school and neighborhood selection,etc.). We are independent decision makers with more control over our life journey than we ever had. How do we translate this control into compounding financial success and security for our families?
1. DO THE RESEARCH
It is natural for us to express fear or uncertainty about things we’ve never tried. Using websites such as Investopedia and NerdWallet to understand financial tools and concepts (401(k), IRA, ETFs, Cryptocurrency, High Yield Savings Accounts, CDs, Stocks, etc.), will help remove that fear, and guide your journey to make the best financial decisions for you and your family.
2. TALK TO SOMEONE YOU TRUST, ABOUT YOUR FINANCES
If ya momma has wads of cash in the couch, the pantry, and under the mattress, she may not be your best bet. Get a financial advisor, connect with a colleague, or join online forums. We love groups and knowledge sharing, joining a community of like-minded wealth building women will surely enrich your life beyond finances. We do not have to go at wealth building alone.
3. SET FINANCIAL GOALS
We are never only thinking about ourselves and always doing for others. This should transfer into our finances. You want to retire in 15 years, have money to pay your child’s tuition, and buy a home. With these goals in mind, you will make an action plan to save a fixed amount a month to reach these goals. Incorporate your goals into your budget or else these are simply dreams.
4. LIVING WITHIN YOUR MEANS
If you really want to buy something that wasn’t planned for, take a few days and come back to see if you want it as bad as you did when you first saw it. Then, if you decide that you must have it, think about whether you can afford to buy it twice. If you cannot, do not buy it until you can. Living within your means consists of accounting for all your monthly expenses, paying yourself and your investments, and not taking a step beyond that. Wealth building involves a substantial amount of discipline, it does not mean you can’t treat yourself.
5. MANAGE EXPECTATIONS
Wealth building is not a get rich quick scheme, it will not happen overnight. You may lose money on the way, but growth requires patience. Pull out quick or don’t invest at all, and you’re sure to miss on gains. Wealth building is a long-term practice.
Existing financial service providers are not evolving fast enough to capture our upward movement, ignoring our obvious holding power. Liquid assets are great, but they aren’t growing and must be supported by investments that do. So, in the meantime while companies figure out we do very much exist and have substantial power, we must take measures into our own hands and bank on BlackGirlMagic.
Continue The Conversation
Imani Johnson is a writer based in Los Angeles, California.
