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The wealth gap between black and white Americans persists. This gap, of course, testifies to the consequences of accumulated inequality and discrimination.
Despite a certain increase in the income and wealth of black families in America, the wealth of white families is often 10 times higher.
Discriminatory financial practices such as redlining or credit discrimination widened the wealth gap and made it impossible for black families to create generational wealth.
However, times are changing.
Black millennials are one of the first generations to bridge this wealth gap to find financial success. These first generation wealth creators tend to be hardworking and incredibly appreciative of everything they have. However, as their success grows, so does the pressure and commitment they experience.
My job as a Certified Financial Planner is to help clients who are first generation wealth builders.
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This important connection can help bridge the gap in America’s racial wealth.
Many of these wealth builders must learn to accept their success, form positive financial habits, and overcome the many pitfalls and obstacles they will encounter throughout their financial lives.
It’s no secret that for these first-generation wealth creators, success isn’t always easy. By the time their success grows, so do the responsibilities and obligations that come with them.
First-generation wealth creators may be putting additional pressure on themselves as their wealth continues to grow. Many people are the first in their family to go to college, earn a high salary, or have some disposable income.
Instead of enjoying their success, many feel guilty. This guilt drives them to take action and find ways to provide for their family (such as parents and grandparents) and the loving wider black community that has helped them over the years and brought them to where they are today.
While there is nothing wrong with this, of course, it can sometimes cause financial strain if a person lets giving back to the community outweigh the smart personal financial decisions they need to make for themselves and their family.
It is for this reason that I urge these first-generation black wealth creators to “put on your own oxygen mask first.”
I’m always reminded that this famous air traveler’s handbook applies to our own financial lives as well. Before we can help our communities, we must help ourselves.
This means that before you can financially support this loving community, you must ensure that you take care of your own financial needs. Whether you have a mountain of student loan debt you’re paying off or a savings goal you’re trying to reach, develop a plan to meet those needs in your own life before trying to financially support others.
Statistically, people in the African American community are significantly more likely to become family caregivers during their lifetime.
As a first generation wealth creator, I understand the desire to give back to my family and my community. It is important to remember our roots and honor the people and culture that make us who we are.
The best way I’ve found to both put your own oxygen mask first and still make room for your community’s financial support is to plan ahead and automate the process.
For example, with every paycheck you receive, set aside a certain amount that will be automatically transferred to separate savings or checking accounts designed to support your family. Having these funds already set aside gives you the flexibility to support family members when they need it without having to spend your personal budget or savings on it.
This system helps you continue to multiply your wealth as a first generation wealth builder in your family, while also uplifting your community in a way that satisfies the emotional responsibility you feel.
Recognizing the responsibility you feel as a first generation wealth creator is the first step to creating a balanced strategy for providing your resources to the community you love.
— Rianka R. Dorsenville, co-founder and co-CEO of 2050 Wealth Partners