(photo: Hello Beautiful)
People of color don't know how to build wealth. At least that's what society has led us to believe. But what is wealth? What does it look like? And if being in the black is such a good thing, then why is being Black making it so hard to be in the black?
As an avid observer of people patterns, I've witnessed what the so called "wealthy" and "not wealthy" do for years. In my research, I've come to the conclusion that there are seven aspects to understanding and achieving wealth. They are as follows:
1. Define Wealth
Literally know the definition of the word. How can we build wealth if we don't know the meaning? Do not define wealth as a "look." Wealth, according to Merriam-Webster, is defined as: the abundance of valuable resources or valuable material possessions. Notice the word resources which don’t mean only intangible items.
2. Periodically Exit Your Culture
Yes, I said. This includes music, television, social media, etc. Take a peek into cultures that don't resemble your own. Examine the habits that are different from your own and explore how they affect wealth. Do not limit your thought processes or ideology to only one perspective.
According to Forbes, the average black household has only 6% of the wealth of the average white household.
Donations and philanthropy is a cornerstone of the wealthy. Even if it's just because wealthy people want to say, "I helped that come into fruition," they give. Dedicating time and making charitable donations will help you understand the importance of giving to others. This will also help you to start thinking about future generations. Check out Why the Wealthy Give by Francie Ostrower.
4. Be Honest
You must be honest with yourself and your situation. You will not be able to build wealth until you review your thought process and spending habits with integrity. Also, be honest with your family and friends with habits you notice of theirs. Constructive criticism has always been a means to help, not hurt.
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5. Read Financial Periodicals
You should already be reading for growth even if it's not for financial gain. Reading financial publications will get you familiar with terms and strategies used by the wealthy. Some well-known examples include: The Wall Street Journal, Bloomberg Magazine, and Barron's. Although we live in a digital age, picking up physical periodicals gives those around you a reason to better their own financial health. Exposing your family and friends to wealth building materials is like paying them intellectual dividends.
6. Check Your Credit Score and Report
Understanding credit is another cornerstone of securing wealth. See the Fair Credit Reporting Act of 1970. Also visit www.annualcreditreport.com as provided by the United States government with no strings attached.
7. Just Do It
This motto from Nike is one of the simplest yet impactful mantras around. If you plan to be wealthy you must start the process. How do you start? Well I can name six ways that you probably know now too that are simple, actionable, and above all, effective.
Investor Takeaway: The key to building wealth isn't limited to just one idea or strategy. It's a culmination of different habits we have to grow into our everyday lives. Are you doing any of the above mentioned recommendations? If so, which ones? If not, which ones would you consider starting?