Why Black Folk Will Always be Broke

In these times of economic turmoil and instability, many are tightening their purse strings across the nation. However, a large segment of the population continues to spend and live above their means — African Americans.

The simple fact is that African Americans do not save money and tend to spend before even considering putting a few coins away. The average African American’s savings level is about 1 percent of annual income when compared to other ethnic groups. This represents the percentage of disposable personal income held in retirement plans and liquid financial assets.

This is strange given the massive spending power that we have as a collective. African Americans spent $645.9 billion in 2002, an increase of 104 percent from 1990, according to Target Market News, a consumer market research and information company. In 2004, blacks' spending power increased to $723 billion, according to U.S. consumer market data, and is currently estimated to be $913 billion.

If African American spending power were considered Gross Domestic Product (GDP) — the measure of a nation’s wealth, we would be ranked 13th, lower than Russia and higher than Mexico, Australia, Netherlands and South Korea. Given this accomplishment, why can't we save some of this money?

We comprise less than 13 percent of the U.S. population, yet account for 30 percent of the country’s Scotch whisky consumption. Detroit, which is 80 percent African American, is the No. 1 market in the world for cognac consumption. According to Target Market, African American consumers spend a significant amount of their income on depreciable products such as $30 billion on clothes and around $15 billion on furniture to put into homes that are mostly rented. The average African American household has also increased its annual spending on entertainment by nearly 30 percent over the past few years.

Regardless of age or income, African Americans contribute less often, and less money to 401(k)s than whites and Asian-Americans. African American employees who earn $120,000 or more have saved $154,902 in their 401(k)s on average compared to $223,408 for whites. Even when comparing households with roughly the same incomes, whites saved nearly 20 percent more each month for retirement.

From income to homeownership to household wealth, we continue to lag behind whites, according to a United for a Fair Economy study. This report observed that a typical white family had six times the wealth of a black family in 2001 and that the gap is growing continuously, particularly with respect to savings and investing.

If we truly desire economic empowerment, then the burden is on us to save. We cannot copy the attitudes of celebrities like Ciara, who in a recent issue of Pride magazine stated that she spends "about $11,000 a month" on shoes and that she owns "maybe a thousand pairs."

2 spend or not 2 spend

Point of order:

A] Almost 600$ in sales Thursday – me likes.

B] Got a call from a former woman (would link her blog but that would be foul-lol), she don’t call unless she wants something. Aint talked to her in a while. She asked me to pay for her tuition (gumption) – I said no. Couldn’t figure out why she would ask me instead of the one she is talking to and desires. Guess prior post was prophetic – go figure.

C] Not sleepy, so made a rib eye and fried 3 eggs at 145am. – Yummy. And don’t forget 5 pieces of bread.

D] Babz blessed the shop, and started taking pictures like the blogger she is LMBAO. She partook in vino.

Was gonna have another thought amnesty today since a many folk say i'm deep or that I think to much, or that I just plane ole hate when I go on my thought crime spree’s. I was either gonna put up the speaking Memphisian #2 or Riddle me this #3. But I decided against such. As you read under point of order A, I have a penchant for paying myself. Now that said, I am reminded of how I have been taught what money was, how to use it and more importantly How to save it. Now I have not nor did I have a desire to watch the talking heads CNN producers aggregated for rating purpose, talk out the side of their necks about what I suspect many already know and experience. Not to mention the folks likely didn’t represent me nor my beliefs and that if it is on TV, it will eventually, like in math, be reduced to the least common dominator of Entertainment.

Now of all folk, I know it’s hard for the average person in America. I know that the value of the dollar aint like it used to be. I know that many of us struggle just to keep a roof over our heads – I know I do. But what I don’t understand is how and why folks say it is hard and even difficult to save.

I mean it seems we have loot for what we want, but not what we need. Sure like I said it is hard, but not that hard. I figure that if a person goes out to a club or bar (which is cool) they will spend somewhere between 20 to $30 on the low end. That’s reasonable. But if we do it twice a week or four times a month, that’s about $2080 to $3120 a year in the first example and $960 tom $1440 a year in the second. Believe it or not that is a lot of loot if such habits persist for 3, 5, 7 years – for which many of us do.

Sure you are or may say it is easy for me to talk, I got a PhD. True I do, but even before then I saved my money. Yea I invest, which think a lot more folk should do, and I see the volatility in the stock market, but I did so since high school and my family didn’t teach me that. I aint never need a flashy car or nothing and I have never had a desire to go to a club and covet the VIP section nor make it rain on a stripper. If I did have the urge to make it rain, it would likily be on a homeless person or in homeless shelter.

Then we add to the problem, for we don’t even recognize how our loot is degraded in meaning. We can go to a club and be made to pay valet parking, and pay $20 to get in when on the regular or for lack of a better descriptor – on white night, one can park they car and walk in free. We don’t even complain, we just stand in line and pay. And don’t let it be a party where some rapper or professional athlete gone be claimed to attend, then we just plum loose our fucking minds

I guess what I am saying is that its cool to enjoy life and make money, but it is not as hard as you think to save it. For although my folk aint invest or teach me how to, they did teach me how to save and that money was to make money and not to spend. Are we the only ones in capitalistic America that cant grasp this concept?