If you’ve followed this blog long enough, you know there are two things I love talking about: being a black woman, and money. This is something I will talk about any day at any time, but with it being Black History Month and all, I’m even more motivated to discuss how these topics relate to one another. That being said, I’m sharing a few things I believe can help young black women create wealth.
*Note: I realize we as black women have a wide range of experiences and backgrounds; therefore, this is not an all-inclusive list.
Advocate for Yourself
We’ve all heard the saying “Closed mouths don’t get fed.” This is especially important advice to heed as black women. We are often taught to keep our heads down, work hard, and wait to be rewarded accordingly. I don’t know about you, but life certainly hasn’t worked out that way for me.
If there’s anything you want for yourself in your career, you must be vocal about it. Are you long overdue for a raise? Schedule a time to meet with your supervisor and discuss it. Is there a new position or professional development opportunity you’re interested in? Make it known.
I should also mention that advocating for yourself doesn’t always mean you’ll get exactly what you want. Although more black women are getting comfortable with speaking up, we still get passed over for promotions and raises at a higher rate than our white/male counterparts. If you’re making your desires known and your company still won’t accommodate you, this means they’re not equipped with the resources you need, don’t take you seriously, or both.
Whatever the reason is, staying in an environment that can’t (or won’t) help you grow will only make you resentful and miserable. This is when you put a strategy in motion to get where you want, even if it means leaving your current employer. This probably doesn’t line up with the mindset you may have been taught, where you pledge your loyalty to a company for years. But business is business, and no one is going to look out for your best interest more than you.
Regardless of how you choose to advocate for yourself, getting the ball rolling on your goals is the proactive alternative to investing time and energy and waiting for others to notice.
Prioritize Investing
Whenever I heard the word “investing,” I always thought of some mysterious and complicated thing only done by old white men in suits. I didn’t get it, and any time I did a little research, I immediately got overwhelmed and gave up. If this sounds like you, just know you’re not alone.
With that said, neglecting to invest can be a significant barrier to building wealth. All the side hustling and saving in the world won’t get you where you need to be. You know why? Because these actions have limitations that don’t compare to the compound interest of investing.
Whenever I speak with people or read finance forums where others share their money mistakes, the most common regret is they didn’t invest earlier—or at all. Don’t let this be you! No one is telling you to throw every dollar to your name into the stock market. The most important thing to understand about investing is that it’s a long-term game. There’s no need to check on your investment accounts multiple times a week because you won’t be able to touch that money for years anyway.
Start with the basics. If your company offers a 401(k) or 403(b) plan, ENROLL. IN. IT. Set up a percentage to be taken out of each paycheck (if your employer offers a matching contribution, this is the minimum percentage you should start at). If your company doesn’t offer a retirement plan, open your own Roth IRA and set up automatic withdrawals to be taken out of each paycheck.
If you take these few basic steps, you’re already lightyears ahead of your peers. Also, if you want some investing info that doesn’t make your head spin, look here and here.
Start a “Me” Account
Growing up, the highest priority I noticed in the household with money, was for all the bills to be paid. Naturally, I adopted this same approach as I became an adult and handled my own finances. There was never a thought of setting anything aside for myself, even it meant literally having pennies to my name after bills were taken care of.
Depending on what responsibilities and family obligations you have, bill collectors are just a few of the people your hard-earned money goes to. As more and more black women are becoming breadwinners, we often find ourselves financially supporting other family members, including parents, siblings, children, or spouses.
When you’re taking care of everyone else, the thought of having any money for yourself sounds impossible. I’m here to tell you it is VERY possible. And if you’re looking to progress financially, it’s non-negotiable. The first step is opening a savings account separate from your regular checking account. I recommend Ally, which currently has a 2.20% interest rate (way higher than the 0.03% at most banks).
Name the account after yourself, name it “Me,” “Selfish,” whatever you want, as long as it’s something that lets you know this money is for you only. Then set up an automatic transfer to this account every time you get paid, even if it’s $5. As it grows, use it for whatever you always tell yourself you don’t have the money for, whether it’s a vacation, pedicure, or startup money for a business. It’s great to take care of those who need you but taking care of yourself should always be a top priority.
Financial Independence > Job Security
I’ve had quite a few “aha” moments where I realized the stable job I had might not be so stable after all. My own experience, along with the common occurrence of government shutdowns and major company layoffs, leads me to believe job security is a myth.
Because of this, I will always advocate for financial independence over finding and keeping your dream job. Even if you are one of the lucky ones who has a job they love, AND there’s a low probability that you’ll be laid off, I doubt there will ever come a time you’ll regret having a backup plan.
An emergency fund is a must, along with a skillset or service you can monetize if you’re running low on cash. Financial independence looks different for everyone, so start by thinking of how much you need in your bank account not to panic if your job lets you go. Then start working towards that number.
Take a Break When You Need to
This one is self-explanatory. I often get riled up about statistics surrounding the wage gap and other racial and gender inequalities. So riled up that I foolishly believe I can hustle hard enough to outpace all the systematic barriers put in place for me as a black woman.
I’m still learning that this self-imposed pressure only leads to burnout. My mind and body have a finite amount of energy to give before they need a break, and instead of fighting against it, I need to embrace it.
We hear about FOMO a lot, but it’s a little different when you’re a black woman. Instead of fearing you’ll miss out on a fun vacation or night on the town, you fear what could happen if you turn down opportunities. This is what causes us to take on that extra project at work even when we’re swamped or a freelance assignment even it means sacrificing a whole weekend.
After all, if you say no to these things, the people who ask may think you lack ambition and drive. If you lack ambition and drive, that could lead to you missing out on future opportunities.
And you know what? You’re probably right. There are a lot of demanding and unrealistic employers and potential freelance clients who expect you to produce work 24/7 and have no life of your own. But fuck them.
You’re human and you need sleep, food, and time to do absolutely nothing. If building wealth is your goal, it’s time to let go of the scarcity mindset, and not just in terms of money. There may be opportunities you don’t take advantage of right at that moment, but it doesn’t mean you’ll never get the same opportunity—or better—in your life. Be kind to yourself, set your own pace, and get comfortable with taking a break when you need to. If you can do that, you’re well on your way to the wealth you deserve.
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