Dispelling Misconceptions about Finances in the Black Community - January C.A.R.E.S Meeting

CARE’s January meeting focused on the speaker and longtime member William Boyd’s presentation, Financial Planning 102. Inflation is a real thing, and it can be a pain when it comes to your finances. According to the Kaiser Foundation, “reveals staggering racial wealth disparities. Even before the Covid-19 pandemic, the 2019 national Black poverty rate was more than double the white poverty rate in the U.S.”

There is a racial wealth gap that creates systematic inequality that has been difficult to eliminate. They are deeply entrenched in America’s labor, housing, education, healthcare, and justice system. A critical factor in helping to eliminate the racial wealth gap is consistent education within the black community. Previously there has been little focus and open discussion about financial literacy. An overall understanding of how money works and the tools to manage personal finances are necessary.

First, we need to understand how our earned money affects inflation. Once we understand inflation, it is recommended that you establish a financial action plan. When establishing a financial plan, it is good to check out your credit score to assist with short and long-term goals. A credit score determines your buying power, and creditors view you as a reasonable credit risk: your credit score influences interest rates, loan approvals, and more.

Next, establish a budget that you can stick to that incorporates paying off your debt. There are many economical resources that assist with debt management. It doesn’t have to cost a lot of money when seeking help to establish good budgeting practices.

After you have an established system in place, it’s time to start thinking about retirement and understanding the differences between a Roth IRA and a traditional IRA. Again, if you are unsure, check into credible establishments within your community that offers help.

The primary difference between a Roth IRA and an IRA is With a traditional IRA, and you pay the taxes on the back end – that is, when you withdraw the money in retirement. An IRA is essential when planning for retirement, especially with the cost of living increasing. It’s never too late to take control of your finances. It can be overwhelming but improving your quality of life is an invaluable reward.

Chat & Resource Information

Annuity.org