We know that the Black community holds tremendous buying and spending power, but statistics reveal that we are struggling to save and build real wealth. Its time for us to change that with the resources below.
The African American consumer market alone accounts for $1.2 trillion in spending annually. The New York Times reports that Black workers are starting to see rising wages. And Zillow reports that Black home ownership rates are recovering from the damage caused by the 2008 Recession.
But there is still the fact that when economic storms arrive, the Black community feels the impact first and harder than every other group.
We are the last ones hired in good times and the first ones fired during bad times. That means all of our gains could be lost if things take a turn for the worst – and they always do.
When the white economy catches a cold, the Black economy catches the flu.
Financial literacy plays a big role here. So before you jump down to the apps, understand the role that savings plays in conjunction with the other 5 components of financial literacy.
The Role of Savings and Financial Literacy in the Black Community
Since many of us were never taught how to build wealth, we go through our lives focusing on just two parts of our relationship with money – spending and earning. But experts teach us that there are 5 components of financial literacy:
3. Saving and Investing
5. and Protecting.
The more knowledge and tools that we have across all 5 components of financial literacy, the more likely we are to survive the bad times and thrive during the good times.
Black people are excellent earners and spenders. We know how to shop, and we know how to hustle. But our behavior ignores one of the most important lessons in financial management:
Its not what you make but what you keep.
That is why the first crucial step on your journey to financial freedom is to save as much as possible, as often as possible. Here is why:
The average person spends money as fast as it comes in. And when more money comes in, their spending rises to match their increase in income. This turns them into wage slaves – always having just enough to spend but never having enough to set themselves financially free.
But when you shift your focus from spending to savings, then you are less likely to spend your earnings on things you don’t need or will regret later on. And the money you save can open up new opportunities to earn even more than what you already have.
How Our Limiting Beliefs Stop Us From Saving Money
According to the data collected by the Federal Reserve in 2016, the average savings account balance of Black households was significantly lower than the averages for all other groups.
This data suggests that (among other factors) there are limiting beliefs that make us less likely to save our money. Limiting beliefs are lies that we accept as true that hold us back from achieving our goals and desires.
Lets make it personal: You might truly want to be financially free, but maybe you have told yourself lies like these:
I dont make enough money to save
Every penny I make goes to bills
I dont have the discipline to save regularly
If you have heard any of those coming from your inner voice, recognize that these are limiting beliefs that are crippling your progress.
The truth is that whether you save pennies or dollars, money is money. And if you treat your pennies well you will be rewarded with pounds.
Three Automatic Money Saving Apps That Take Away Your Excuses
Technology makes it so easy to save small amounts automatically that you have no reason why you should feed your limiting beliefs.
New tools like the ones below let you save pennies from every purchase you make and piles them up until you achieve your financial goal.
Whether you are saving for generational wealth, a newer car, or an upcoming credit card bill, here are three tools that will help you overcome your limiting beliefs about money and start building true financial stability.
Digit App Is My Number One Pick For Automatic Savings
Digit is my favorite savings app of all time. I started suggesting this app to our members way back in 2018 and the app has come a long way since
then. Heres how it works:
Digit takes a small amount out of your bank account every day. You choose the amount. And if you need to withdraw that money, it lands back in your bank account within 1 business day (unlike Stash, which can take up to 5 days).
I like the fact that you can save for very specific goals.
I also like the fact that you can save money for upcoming bills and link
your account so that Digit will pay them on their due date. That means you are building your savings and improving your credit at the same time.
If you want to try Digit, use the button below and get $5 for free. Thats free money for saving money.
Stash Lets You Save And Invest In Stocks Automatically
Most people swear by Stash because it works the same as Digit, only it saves your money and invests those savings into any stocks that you choose.
The fees are also the lowest on this list. For just $1 a month you can turn your spare change into a robust investment portfolio.
With more than 3,000 ETFs and individual stocks available, I suggest you start with Stash if you are a beginning investor or you want to avoid the higher fees that Digit charges.
Acorns App Lets You Save The Spare Change From Your Everyday Purchases
Acorns takes change from your everyday purchases and saves it. You can also choose to invest your savings into a portfolio based on your investment goals.
The portfolio is managed by legitimate investors, so you can trust that your money is being invested properly.
I am personally using their High growth potential option to maximize my returns. You can choose from several other options that are lower in risk, or just save your money and keep it out of the market.
Wish you could have invested in bitcoin back when it was just $50? Or how about that house that your state auctioned off for just a few thousand dollars?
Those assets could have been yours if you had the savings to secure them.
When you are sitting on a nice pile of cash you can take advantage of investment opportunities that other people cant, so scroll back up and take action or risk missing the next opportunity to change your financial life.