Guest Contributor – Lionel Shipman
Lionel Shipman is the owner of Shipman Consulting, a personal and business finance-consulting firm specializing in helping individuals and businesses improve their financial outlooks. The primary focus of the firm is facilitating seminars and classes to educate, motivate, and empower people to take charge of their financial lives. The firm also offers one-on-one consulting services.
Please visit the firm’s website for information at WWW.ShipmanConsulting.Com.
Know Your Money
Monday – April 13, 2015
Financial Literacy Month 2015
The Black Financial Gap In America
By Guest Contributor Lionel Shipman
The financial plight of many Black Americans has not been positive over the years. In fact, the financial gaps in the areas of income and wealth among many blacks continue to widen compared to whites. In 2013, the medium household income of blacks was $34.5K compared to $55.2K for whites based on data from the 2013 US Census Bureau. Things remained relatively unchanged from 2010 with a medium household income of $34.3K for blacks and $55.2K for whites.
According to a new Pew Research Center analysis of data from the Federal Reserve’s 2013 Survey of Consumer Finances, the wealth of white households was 13 times the median wealth of black households in 2013, in comparison to eight times the wealth in 2010.
The financial gaps can be attributed to a number of factors such as the scarcity and accessibility of money management skills and the desire to acquire financial education. There are a number of programs available that aim to teach and instruct people with their personal finances. But, many blacks are not able to attend those programs for a variety of reasons and some blatantly refuse to attend even though they are able. Then, there are some that are not aware that financial programs exist.
Oftentimes, when financial seminars are offered there is limited to no interest in attending. In addition, some blacks find no practical value in the financial programs. They allow intimidation and pride to keep them from acquiring financial knowledge and understanding. They have been operating their finances for years and refuse to accept that they do not know it all when it comes to money management.
People need to realize that knowledge is power. But, applied knowledge is powerful. It does not take a college graduate to learn the basics of money management. Educating oneself regarding money and money management is open and available to everyone. But, every individual must make the decision to learn and apply that knowledge to their own financial lives.
In today’s society, there are many outlets ranging from radio programs and television shows to seminars and books that emphasize the importance of financial education on various topics such as basic money management and investing. However, some people are ignorant of the importance of financial education and some just do not want to learn even when it is at their fingertips.
There are people who would rather spend their money on entertainment or personal things as opposed to establishing an emergency account, savings account or retirement account. Some people are more concerned with looking good, driving well, and living large as opposed to utilizing a budget and becoming debt free. Some people live for the “here and now” and could care less about the “later”.
I believe if financial education was mandatory as well as the benefits of financial education was expressed more to the masses at an earlier age, like many other things in life, blacks as a whole would operate their financial lives more efficiently and the financial gaps would narrow.
Here are 4 ways to narrow the financial gaps:
- Take the initiative by enrolling into financial classes and/or attending financial seminars/workshops and learning ways of improving your financial outlooks
- Spend quality time reading financial magazines, newspapers and articles to increase your knowledge of money management
- Apply what you learn. Utilize the money skills you acquire.
- Do not allow fear, intimidation and pride prevent you from learning and applying money management skills
Here is today’s step to financial wellness from Thirty Steps to Financial Wellness developed by Money Management International:
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Disclaimer: I have a Bachelor of Business Administration degree but I am not a financial adviser. However, I have acquired years of knowledge about personal money management through my life experience working through my own personal finances that allows me to share that knowledge with readers of Know Your Money. The Know Your Money Blog posts written by me are my own common sense observations and opinions and are for informational use only. Although my blog includes contributions from experienced financial professionals, please make your own financial decisions based on personal research or contact a financial adviser.
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