income grow. On a larger scale, by purchasing real estate, black people can establish communities that they can shape and control for their own benefit. When you own where you live, it gives you political clout within congressional districts. Collectively, homeowners can create a strong foundation for community growth in the future.
Establish family businesses. A business provides a means for a family to sustain itself. Whether you plan to have a large corporation or a consultancy, such operations provide additional streams of income to pay for additional real estate, education, or other financial goals. These businesses also serve to provide jobs for other black families in the community. If every black household established a business or trade, no matter how small, black unemployment would be significantly reduced. By passing on a tradition of entrepreneurship, we ensure wealth is passed to the next generation.
Create an estate plan. An estate plan includes insurance, a will, and if possible, a trust. You must protect your assets with a will, because if you don’t, your heirs — the people you love and work so hard for — will never reap the full benefits of your accumulated assets. The trust will make sure that your assets are distributed according to your wishes. Insurance policies will pay off the home mortgage, any lingering debt, and provide your family with additional income. Using a will and trust are the only way to ensure wealth is transferred to the next generation.
Last year marked the 40th anniversary of the civil rights movement. Over those 40 years, black Americans have significantly increased our wealth-building capabilities-48% of black Americans are homeowners. Last year we generated more than $723 billion in total money income and there are thousands of black millionaires and a few black billionaires. With the baby boomer generation set to retire in vast numbers over the next 30 years, it is imperative that the wealth they’ve accumulated is successfully transferred to their heirs. That wealth could then serve as the foundation of a black economic empowerment movement. — Matthew S. Scott
OUR READERS RESPOND: How much do you have saved for your retirement right now?
- Less than $40,000: 66.1%
- $40,000â€”$100,000: 20.1%
- $100,000â€”$250,000: 8.4%
- More than $250,000: 5.4%