The Investing Habits of Wealthy Black People

Black households earning $ 200,000 or more are among the fastest growing groups in the U.S.  This is rarely addressed in discussions about black wealth, as the media and politicos focus so much attention on the bottom of the wealth gap, that they fail to highlight the strides that so many blacks are making. There is no intention to minimize the need for solutions to socioeconomic issues, but we can also learn a lot from the behavior, especially the investing habits of wealthy black people.

A study by Credit Suisse Research and The Heller School for Social Policy and Management at Brandeis University found that the top 5% of African Americans, those with a median net worth of $ 739,000 or more, have a more conservative approach than their white counterparts; owning less in stocks and bonds, and more in CD’s savings bonds, and life insurance. The study also found a higher level of investment in real estate outside of the primary home, 41% of non-financial assets, versus just 22% for whites in the same income bracket.

“This more conservative approach of the top 5% of African Americans to investing is understandable when looking at the constrained social mobility trends of the African American population and lower levels of overall economic security,” study researchers say.

“Owning land is what many of our forefathers experienced as a way to gain wealth. Also, the black community understands homeownership,” says Shelly-Ann Eweka, a certified financial planner with TIAA.

“We should focus on portfolio diversification for wealth building. This is not to say that real estate and entrepreneurship do not produce great wealth for individuals. You want to make sure that you are well-diversified when deciding on how to invest your assets to meet your financial goals,” she adds.

Eweka and others also emphasize the importance of working with a financial planner so that you can determine a productive asset mix that allows you to sleep at night.

-Editors’ Note: Updated from original publish date in March 2016

Money | Black Enterprise


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Entrepreneurs: Here Are 3 Ways Bad Health Habits Can Cut Into Your Bottom Line

Not living as healthy a life as possible can lead to more than just physical challenges. The fiscal results can add more problems to your life—but some are avoidable. Here are three bad health habits and how they can affect your financial health and that of your business.

Smoking: Quitting smoking is considered one of the hardest endeavors to take on (and science backs this notion.) Besides the fact that a pack of cigarettes can cost you up to $ 17, the American Cancer Society reports that tobacco-related healthcare costs are more than $ 130 billion and the direct healthcare cost for those who smoke cigarettes is about $ 35 per pack. (So, let’s say you smoke only a pack per day. That’s more than $ 13,000 per year.)

Recent Wallet Hub research also indicates that smokers can lose up to $ 5,932 per year in income, and more than $ 156 billion is lost in productivity due to premature death and exposure to secondhand smoke. In some states, health insurance premiums are higher for smokers—up to 50% higher than those who do not smoke.

The American Cancer Society and healthcare professionals cite options for quitting including counseling, nicotine-replacement therapy, and prescription drugs. Smokers are also advised to seek help from a licensed medical professional or to take advantage of cessation programs covered by insurance.

Overworking: There are several health-related effects of overworking and researchers have found that the resulting stress can lead to depression, heavy drinking, impaired sleep, diabetes, and other conditions and illnesses. It can also lead to a loss in productivity, which is quite counterproductive. The domino effect: absences at work, appointments, and business meetings, which then leads to a breakdown in your reputation and credibility as a leader. If you’re missing a meeting that could have netted you that lucrative partnership, that’s money lost to your business. And even if you show up, you won’t be at your best—yet again risking the loss of money-making opportunities.

Productivity experts suggest working in 60-to 90-minute intervals throughout the day, and to manage your time in a way that promotes a healthy balance between professional and personal time. Prioritizing deadlines, being prompt for meetings, and avoiding distractions are all ways you can avoid unnecessary midnight oil-burning sessions.

Skipping Doctor’s Appointments: No-show rates for doctor’s appointments can range from 5% to 55%. Not scheduling routine exams, especially for conditions and diseases that disproportionately affect black women and men or people of a certain age range, can mean missed diagnosis and exposure to health challenges that could have been avoided or treated earlier.

The CDC indicates that getting the right health services, screenings, and treatments, help your chances for living a longer, healthier life, and catching things early can help to avoid the healthcare and insurance costs that you could face if a condition is not detected early enough, gets worse, or leads to a more serious one. It’s definitely less expensive to go to the doctor regularly than to avoid it for years and end up having an extended stay in a hospital or high costs of a lifetime of prescription drugs or medical treatments.

Editor’s Note: This article originally published on July 2, 2016 

The post Entrepreneurs: Here Are 3 Ways Bad Health Habits Can Cut Into Your Bottom Line appeared first on Black Enterprise.

Lifestyle | Black Enterprise


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