These days are full of stress, protest, and explosive rhetoric.
Sooner rather than later, we will have to address the major steps toward long-term stability — economic, social, and otherwise.
That means revisiting the savings and retirement readiness gaps within our minority communities.
We have to better understand these challenges in order to implement the right ideas and policies that will make our country as a whole more secure.
Money matters because we’ve seen how a lack of financial security certainly leads to personal disarray and painful outcomes.
How can we better shine the spotlight on sensible solutions so more people share a piece of the opportunity pie?
It will take hard work to bring private sector solutions to this dilemma. But what is clear is that big government solutions haven’t done and cannot do the job.
- To begin the road to recovery, we need to get our job engine running again. Corporate America is on alert on the need for action.
It may now be more interested in creative solutions for getting minority employment back on track and for providing enhanced job security.
In February of this year, the black unemployment rate plunged to 5.8 percent, close to lowest figures since 1972, when records began.
However, in May, the black unemployment rate surged to 16.8 percent and the Hispanic jobless rates jumped to 18.9 percent
Nearly 44 percent of black families and 66% Hispanic Americans reported in April that they or someone in their family had experienced job loss due to the COVID-19 pandemic. This is a stunning downturn after historic employment gains in the past few years for all demographic groups.
The large number of virus cases among black and Hispanic families also caused further stress to already strained household budgets.
If many Americans who are no longer earning income now continue to stagnate, there is no way they can prepare for anything that looks like retirement security.
- Now that corporate America agrees that it is time to focus on minority hires and advancement, let’s keep them focused to ensure all employees have access
to retirement savings vehicles like 401(k)s. It’s not enough to just offer the plans if they are not accessible.
Employers need to make sure these workers understand and take advantage of the value of these opportunities.
Even if employees cannot, it is more important than ever for business to encourage participation in workplace savings plans and offer better educational tools so that employees build up some savings.
In the most recent data available, white Americans had about $130,000 in liquid retirement savings like 401(k)s, while black employees averaged only $19,000.
Black and Latino households may require more savings support. A proposal called “Promise Accounts” is a matching program in consideration to incentivize savings and provide a needed assist in getting more Americanson a wealth-building path. All accounts would be managed by the U.S. Department of Treasury, guaranteeing safety, administrative efficiency, and low cost.
- There are an impressive number of groups and professionals dedicated to helping minorities understand financial literacy and business opportunity.
New York Jets linebacker and Wharton graduate, Brandon Copeland, 28, teaches a financial literacy seminar called LIFE 101 at the University of Pennsylvania. His main lesson is the importance of saving. Regardless of the size of your paycheck, everybody should maintain the key discipline of saving part of your income.
Marshawn Lynch, a Seattle Seahawks running back, has this sound advice to young players or anyone – "take care of y’all mentally, bodies and y’all chicken. Money can easily be wasted, so be careful.”
Robert Smith, billionaire CEO of Vista Equity Partners, who recently paid all the student loans of Morehouse College graduating class of 2019, tells his black audience to take risk while young: Position yourself to win in promising sectors of business no matter where your entry point, don’t let bad situations become barriers – learn how to fight. These are just some ways to build savings, wealth and security.
These black leaders and many others hammer home time tested ways all groups benefit from long established lucrative paths:
- Work, save, and invest for decades.
- Start a business, run, and sell it successfully.
- Own real estate. Do not over-leverage yourself and benefit home appreciation over time.
Americans are incredibly hardworking, resilient people. Small business and the American worker are holding up better than many imagined.
The media myth that a mystical money machine exists to produce immense prosperity and privilege for only a chosen few, and people of color are doomed because we have no access to this magic carpet, does not do us justice.
That there has been untold suffering, racial injustice, and cruel barriers to success is sadly true.
But now is the opportunity to grab this moment and create a new chapter to broaden prosperity — as long as the focus remains on results and not rhetoric.
America’s story is and will remain a tale of progress. As a daughter of immigrants from the Dominican Republic, we had painful struggles along the way working, assimilating, and building a productive, ultimately wonderful life.
Tragedy can be a force multiplier to incentivize success. And success — however defined — is the best revenge.