Dr. Boyce Watkins' Top 5 Financial Things to do in the Year 2011

Filed under: Dr. Boyce Money

Remember the days when people wondered what it would be like to party like it's 1999? If you are 35 or older, you are probably wondering how we ever got to the day where 1999 would be a distant memory. Here we are, approaching the year 2011, the day that once seemed far off into the future. There are no flying cars, no robots taking us to work, and nobody has a condo on the moon. In fact, many of us are as broke as we were back in the early 1990s.

I came up with a list of five financial things that black folks can do during the year 2011 to improve our collective economic plight. We've struggled our way through one of the greatest monetary crises in American history, and we are the only ones willing to take a stand against economic inequality (none of our politicians are even talking about it). None of us is perfect when it comes to how we manage our money and reach our goals, but we should all be striving for something better. Here are five things you can do this year:

1) Find an alternative stream of income: Count the number of sources of income coming into your household. If the number is just one or two, you are in serious trouble. Try to find something on the side that allows you to add one to that number: it might be a part-time job, selling some kind of product, or allowing someone else in the household to get a job so they can contribute (only children under the age of 14 were allowed to be freeloaders in my mama's house). The new stream might be a trickle at first, but with consistent effort, the stream will grow. Having extra ways to pay the bills gives you more security than you would have by getting everything you need from one place.


2) Save at least 10 percent of what you earn: Many black folks will give 10 percent of their income to their pastor, but won't put 10 percent of their income aside for their own family. You must save your money so your money can save you when times get rough. Have an automatic deduction of 10 percent of your income pulled out of your paycheck before you even get a dime. This will make a world of difference on your path to financial independence.

3) Do research on how to start your own business: This doesn't mean you need to quit your job today and go for it on your own. It only means expanding your skill set and slowly teaching yourself how to create a job instead of going out and getting a job. Think of it like learning how to plant a small garden in the event that there is a disaster and the grocery stores are all closed. You may never need to plant a real garden, but it doesn't hurt to learn how to do so.

4) Check on your retirement plan: According to the Employee Benefits Research Institute, the average American between the ages of 55 and 64 has less than $70,000 saved for retirement. In case you're wondering, that's not enough money to last for the 15 - 20 years you would expect to live beyond the age of 65. For black folks, who have far less wealth and income, the number is much lower. Social security and the federal government are struggling, so they aren't going to be interested in taking care of you at retirement either. I recommend checking to see how much money you have in your retirement account and finding out how much more you need to save in order to be ready for your golden years. If you don't have a retirement account in place already, go to your bank or employer and ask them to help you open one.

5) Prepare for the day you die: Many of us have seen people die without making proper plans for their departure. They don't have life insurance paid up, there is no will in place to distribute their assets, and their children have no idea where important documents are located. This only adds to the drama and misery people are already feeling after the death of a loved one. Sorry to tell you this, but you're going to die. Also, there is a good chance that you're going to die without warning. Therefore, it is a matter of urgency that you reduce the trauma by planning carefully for your death. Make sure you have an updated will, life insurance and all the things your family will need to bury you and keep it moving after you're gone. It's just too important to ignore, especially if you have dependents.

These are just a few things we can all do to make 2011 the best year ever. Remember: YOU are the one who gets to decide if this is going to be the greatest year of your life. Every year should be better, stronger and more productive than the last. Just take it one day at a time and ensure that you step your game up to the level that you expect. Life is too short to be mediocre.

Dr. Boyce Watkins is the founder of the Your Black World Coalition and the author of the bookBlack American Money To have Dr. Boyce commentary delivered to your email, please click here.

 

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