Building Wealth: Your Net Worth is Your Power
Earlier this week, it was announced that Black spending power had reached a record-breaking 1.6 trillion dollars; however, the net worth among us has decreased by 14%. The median Black family net worth is only $24,000. Net worth is the value of all assets minus the total liabilities. In other words, your net worth comes down to what you own minus what you owe. The number one factor that interferes with our ability to build wealth is debt. Although many of us have been conditioned to live off debt, the truth is debt only controls us and weakens our ability to prosper financially. While black spending power increases, how that money is best used to rebuild the black community is questioned. How are we using our power?
In the 1920s, there were only 1000 black people with a bachelor’s degree. This was a huge improvement for us at the time because, as enslaved people in America, learning to read and write was illegal. Imagine how chaotic your life would be if you didn’t know how to read or write. How many opportunities would you get to prosper in this country? They would be limited, if not nonexistent.
Black people have gone from not being allowed to read and write to having 6.5 million with a bachelor's degree. This has significantly impacted our opportunity for growth and wealth. Unfortunately, if we don’t begin to improve our net worth, it will affect our educational, political, and health equity opportunities.
“You either get better, or you get worse; you never stay the same.”
Your net worth never stays the same; it directly relates to your well-being, freedom, peace of mind, and independence. If you spend all your income, you can’t build your net worth. Your net worth is your power! There have to be more conversations and education on building up our net worth in the Black community. Our spending power becomes irrelevant if we fail to improve our net worth. With buying power comes influence; it’s time for us to use our power to invest in ourselves and our community and families.
The first step to improving your net worth is by assessing your spending. How and where are you spending your money? Most people are focused on increasing their yearly salary, but net worth is different from income since we don’t necessarily keep every dollar we make. Instead, we buy, borrow and make investments with money, and the total value of our properties and cash goes up and down with time.
Obtaining college degrees and increasing your yearly salary means nothing if you aren’t using that as a platform to invest in your future. Your net worth should be growing yearly. Think of your net worth as a big-picture way to measure your financial health.
Be intentional with how you spend and invest your money. If you build your net worth with the target of 3 generations, you will achieve true generational wealth. Improving your net worth puts you in a stronger position financially, improves your quality of life, and puts you in control of life’s unforeseeable circumstances. Maximize your wealth by stepping into the power of your net worth!
