Why Generational Wealth Is The Ultimate Form Of Securing The Bag
This post was originally published on MommiNation.
I want to take a moment to discuss a very serious topic. A topic that the success of our children, future grandchildren, and even our nation depends on. Let's have an open dialogue about wealth in the black community.
According to a study completed by Prosperity Now, "If the racial wealth divide is left unaddressed and is not exacerbated further over the next eight years, median Black household wealth is on a path to hit zero by 2053." $0?!? That is in less than 35 years. Personally, my son will only be 47, and I, for certain, cannot let this become his reality. We cannot let this become reality!
Reflect on the concepts you learned growing up around wealth. Where did you learn those concepts? Most likely, you didn't learn anything about wealth in school. I'd be willing to bet that whatever you learned, good, bad, or indifferent, you learned from the examples within your family dynamic. Have you noticed the difference between the wealth of blacks vs. wealth of whites? I'm sure you have. But how can we close this gap and how can we blur the lines to make it impossible to notice this difference?
The answer is within our children.
It is our responsibility to teach our children about generational wealth. It is one thing to teach our children how to have a healthy relationship with money, but if we are not passing wealth on to them, we cannot be sure they will acquire it. It is time we break the generational curse of scarcity and start securing our legacies. We can disrupt the wealth gap, but we must be intentional and forward thinking. Generational wealth is not just about money passed down, it is also opportunities, support, and investments to generate more money.
Let's talk steps:
Self-Care
GiphySelf-care is not only about taking bubble baths, meditating, and working out. Self-care is about preserving your health, which includes your financial health. If you have mountains of debt, poor credit, no savings/investments, or unhealthy spending habits, that is what you will pass to your children. Before your child can become wealthy, your financial independence is required. This is the first step to setting your children up for generational wealth.
Multiple Streams of Income
GiphyWe are talking about building wealth, therefore having only one source of income will not cut it. Take all of your eggs out of that one basket and start spreading the wealth. It is almost impossible to depend on a 9-5 to build wealth when lay-offs, pay cuts, and unforeseen circumstances can storm through your life at any moment. Multiple streams of income not only provides security, but it also builds wealth. Many financial books (as well as the internet… and you know the internet is always right) proclaim that the average millionaire has seven sources of income. How many streams of income do you have?
No Fund Me
GiphyLife insurance is not to protect you, it is to protect your family. Life insurance is important for several reasons. The most important reason is to ensure that you do not pass on debt to your loved ones. Leaving funeral expenses, debt, and financial burdens to our loved ones must stop! If you take nothing else from this article, take this. Go get a life insurance policy ASAP! I cannot see another GoFundMe as a substitute for life insurance. In addition to covering your debts, life insurance can leave a substantial inheritance for your family leading up to the time that you have successfully built wealth yourself.
Credit
On the personal finance scene, there is a big debate around the use of credit. Personally, I feel like credit is a necessary evil. When your child is 16 (as young as 13 with some companies), add them to your oldest credit card with excellent payment history, utilizing 10% or less of the limit, and ensure the company is reporting to the credit bureau. Warning: This should ONLY be done if you are an extremely responsible credit card user. If you are not, DO NOT take this action and see number 1 on this list immediately. Please do not ruin your child's credit before they are old enough to ruin their own. Building your child's credit at an early age allows them to immediately obtain business loans, an auto loan with a low-interest rate, buy a home, get an apartment, etc. If you are successful at building wealth, which allows them to cash flow all expenses, they will not need credit. But, it will not hurt to have a 700+ credit score at the age of 18.
Investments
I could write an entire blog post about investments and how important they are (and actually, I probably will in the future). But for now, I'll keep it brief. THIS is the part where you build wealth. In order to pass down wealth, you want to pass down assets that will continue to generate more assets.
Retirement Account
- First and foremost, you should have a retirement investment account. This will prevent you from working the rest of your life while continuing to generate passive income. Once you leave this earth, your contributions will be transferred to your beneficiaries (your family).
Real Estate
- Investing in property is arguably the most efficient way to build and pass on wealth. Real estate is a tangible purchase you can make that will appreciate and become more valuable over time.
529 Plan
- Invest in your child's education. Now this is one I am passionate about because I have a massive amount of student loan debt that has prevented me from living my best life and also put me behind the curve of building a legacy for my child. Recent studies show that the US student loan debt is $1.5 TRILLION and black women hold $890 BILLION of this total. Whether college is necessary is debatable, but I can tell you as a person that hires/fires in corporate America and a person whose income has tripled because of a Masters degree, having a degree opens more doors than not. Take advantage of a college savings plan at a young age and prevent your child from falling in the student loan trap that will make it difficult for them to build and pass on generational wealth.
Stocks, Bonds, and the Likes
- Stash money into low-cost investment funds for your children at a young age. Let compound interest do its thing, and your child will be set when they enter adulthood.
The transmission of wealth is often accomplished much earlier in life and in less direct ways than inheritances during late adulthood. Securing your family's legacy will take intentional small steps that will make a substantial impact. Start now! Finish strong! And let's secure the bag our children will benefit from for generations to come.
Were you set up financially for generational wealth? Have you utilized any of these tips to set your children up for wealth? Or were any of these tips utilized to prepare you to receive wealth?
Written by Mykal Steen
Originally published on MommiNation
Kids need a village and moms need a nation! MommiNation serves the tea on everything about motherhood you never thought you needed to know by bringing together many of your favorite mom bloggers and experts all in one place.
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ItGirl 100 Honors Black Women Who Create Culture & Put On For Their Cities
As they say, create the change you want to see in this world, besties. That’s why xoNecole linked up with Hyundai for the inaugural ItGirl 100 List, a celebration of 100 Genzennial women who aren’t afraid to pull up their own seats to the table. Across regions and industries, these women embody the essence of discovering self-value through purpose, honey! They're fierce, they’re ultra-creative, and we know they make their cities proud.
VIEW THE FULL ITGIRL 100 LIST HERE.
Don’t forget to also check out the ItGirl Directory, featuring 50 Black-woman-owned marketing and branding agencies, photographers and videographers, publicists, and more.
THE ITGIRL MEMO
I. An ItGirl puts on for her city and masters her self-worth through purpose.
II. An ItGirl celebrates all the things that make her unique.
III. An ItGirl empowers others to become the best versions of themselves.
IV. An ItGirl leads by example, inspiring others through her actions and integrity.
V. An ItGirl paves the way for authenticity and diversity in all aspects of life.
VI. An ItGirl uses the power of her voice to advocate for positive change in the world.
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Just When This Couple Was Ready To Delete Dating Apps, They Matched & The Rest Is History
How We Met is a series where xoNecole talks love and relationships with real-life couples. We learn how they met, how like turned into love, and how they make their love work.
There was a time when the question, "Does he give you butterflies?” was always associated with happy feelings and positivity. But between love bombing, situationships, stories like Reesa Teesa, and the overwhelming number of bad dating stories, many millennials have become hesitant – even cautious – of feeling chemistry too early. Nevertheless, the truth remains: if intentions are genuine, there’s nothing wrong with acknowledging the spark sooner rather than later.
Frederick and Josephanie Buffington are a beautiful testament of this notion. During our discussion, they humorously walked me through how they connected, their immediate attraction, and how they’ve been able to passionately follow these feelings all the way to the altar. The couple attributes their exciting new marriage to discovering who they were individually and knowing what they desire from partnership prior to meeting. Check out their story below.
How and where did you two meet?
Frederick: Well, I’m a Southern gentleman from Arkansas. It’s not really my thing to get into dating apps and stuff like that. But after being in Atlanta for a while and talking to a friend from the area, she explained why she deals with them, and it made sense to me. So I gave it a try, and it failed about eighteen times (laughs). But when I was on the verge of hanging it up, a pretty little thing popped up on my screen.
Josephanie: I actually got on the app that day to delete it. I was like, I’m done with this, and I don’t want to do this anymore. But I saw him and was like, let’s wait a second. And he sent me a message, we matched, and the same day he called me. We ended up talking on the phone for like seven hours, and that was like it for us.
"I actually got on the app that day to delete it. I was like, I’m done with this, and I don’t want to do this anymore. But I saw him and was like, let’s wait a second. And he sent me a message, we matched, and the same day he called me. We ended up talking on the phone for like seven hours, and that was like it for us."
Were you attracted instantly, or did it develop over time?
Josephanie: No. Nah, I’m just kidding – I was always attracted to him.
Frederick: Yeah, she has always been this fine.
xovelshee/ Instagram
Walk me through the courtship. Did y'all ever have that awkward “what are we convo, and who initiated it?
Josephanie: No, we didn’t have that conversation. Because it went so fast, after date three, we decided we were doing this.
Frederick: By then we had talked about life goals and everything enough that we realized if we went different ways, we would be stupid.
And what made you want to commit to a relationship with one another? How did you know it was special?
Josephanie: Because it went so fast. It was like a whirlwind, and usually, I steer clear of those. But this was fun, intense, and energy-filled. So I was like, let’s just ride this wave and see where it takes us.
Frederick: Yeah, and we ended up here. I’m really picky about everything. For me, it was like 2-3 weeks in when I realized she wasn’t getting on my nerves, so I knew it was something there. It sounds funny, but I’m serious. Like, I used to get to a point in dating where I’d start thinking a woman breathed funny or just something random would turn me off. This was different. I was just enjoying it. And still, no matter who I’m in the presence of or who approaches me, I just don’t see anything trumping this.
"It was like a whirlwind, and usually, I steer clear of those. But this was fun, intense, and energy-filled. So I was like, let’s just ride this wave and see where it takes us."
xovelshee/ Instagram
Speaking of time, what do you do to keep the relationship spicy?
Josephanie: That’s all me. (laughs)
Frederick: That’s where her career as a sex therapist comes in. (laughs).
I love that approach. I’m curious what did you two learn in your single season?
Josephanie: I got to know myself and put emphasis on my intrinsic value. It’s not about 'what I’m bringing to the table.' It’s about who I am as an individual, and what my value is, and where my value lies. That’s not about what I’m doing but who I am.
Frederick: Yeah, I figured out who I was before I got with her, too. Outside of social media and what your friends/family think, it’s important to figure out what you like because, ultimately, you’re going to have to live with that decision. So know who you are and let them know who you are. During my single season, I took the time to really know myself and I focused on what I like. Again, I’m picky. So, I had to figure out what I really liked before I drove someone else crazy. And then she was patient with me, so I ended up making a good choice (laughs).
xovelshee/ Instagram
What was the biggest challenge that you had to overcome together?
Josephanie: I recently had surgery. So, I had 64 fibroids, a major abdominal myomectomy. I couldn’t do anything for myself, and he was there 24/7. I was in the hospital for 5 to 6 days, and he slept on the floor the whole time.
Fredrick: And those floor mats were not there for everybody. Her mother was there too – shoutout to her mother. That was definitely something very challenging that we got through together.
Finally, what’s your favorite thing about each other?
Frederick: Her booty. No, I’m just playing. I’ll give it to you in order: her confidence, intelligence, humor, and then the booty and smile.
Josephanie: My favorite thing about him is that he is the epitome of Black boy joy. He’s always laughing, he’s always smiling. There’s always jokes. His personality radiates. You can’t help but want to be in his presence.
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