The Broke Diaries
African-American women are making significant economic strides. According to recent statistics, we're graduating from college in historic numbers, more of us are climbing the corporate ladder, and we're opening our own businesses. So why are we always crying to our girlfriends that we're so broke?
When I got my first job out of college, I thought I was financially set. Giving little thought to tomorrow, I quickly developed a "spend it 'til it's gone" mentality. My apartment was leased. My car was leased. My furniture was rented. My first stop on payday? Lenox Square mall in Atlanta. My credit cards were maxed out and my savings account balance was zero. Everything I owned, everything I considered to be of value, was on my back. Sound familiar?
Best-selling author and money coach Lynnette Khalfani, who tackles the subject of money woes in her must-read feature "Black, Fabulous & Broke" (page 120), says even she wasn't immune to the debt trap. "I once had $100,000 in credit card debt," she confesses. But Khalfani knew she had to make a change after panicking one anxious evening at a fancy restaurant, worried that her credit card might be declined. (I know some of us can relate.) "I paid off all my debt in just three years and ultimately transformed my entire financial life," Khalfani says. "I now have an array of blessings, including a hefty bank account, a beautiful home and the economic freedom to enjoy a lifestyle most people only dream about."
And luckily she wants to share her tips with you!
Hers is the story you can't afford not to read this month. According to a 2005 report published by Demos, a New York think tank, one out of eight African-American households with debt use more than 40 percent of their income to pay their bills. And currently less than half of us own the homes in which we live. While I'm far from being a disciplined money manager (a pesky shoe addiction sometimes keeps me from being as fiscally responsible as I should be), I try to live by five simple money rules: (1) Own your own home; (2) pay yourself first each month by setting up an automatic deposit into a savings account; (3) don't charge more than you can pay off in a single month; (4) enroll in your company's 401(k) plan and max out contributions; (5) develop multiple streams of income.
Take these tips along with Khalfani's advice and make today the day you take control of your finances and get the keys to the life you and your family deserve. That's money in the bank! E-mail me at firstname.lastname@example.org and let me know what steps you're going to take to achieve your financial dreams.
My Five Simple Money Rules
1. Own your own home.
2. Pay yourself first each month by setting up an automatic deposit into a savings account.
3. Don't charge more than you can pay off in a single month.
4. Enroll in your company's 401(k) plan and max out contributions.
5. Develop multiple streams of income.