Getting On Track

The Advice
Black Enterprise and Wells Fargo financial adviser John Nelson in Cliffside Park,
New Jersey, offer this advice to help White meet her wealth-building goals.

• Get help to change financial behavior. White needs to change her behavior and focus on maximizing her income potential instead of relying on her business venture to fund her retirement. be recommends that she continue working with a financial planner and enroll in financial empowerment courses.

• Delay home buying and business goals. White should not even consider homeownership or restarting her business until she gets her financial house in order. She needs to get back to the basics, building an emergency fund equal to six to nine months of expenses as well as secure the 20% down payment needed to purchase her home. “While I understand that reopening her business is a priority for her, I urge her to consider delaying the start date until the necessary startup capital is fully funded,” says Nelson. “For the house, she should delay that for two years to accumulate $30,000 to $40,000 to cover the down payment and closing costs.”

• Curb spending. Nelson estimates that White can cut about $200 per month in dining out and health and fitness. Since every bit counts, she can design her own exercise program and save the money on a gym membership and allocate those funds to her savings. She should also stop eating out and other such indulgences.

• Sell her second car. In addition to the 2010 Camaro, White owns a 2002 Nissan Maxima, which is paid off. Nelson says she should sell her second car. “That would be $4,000 she can put aside for her home purchase or business. There is no sense in retaining it; it will continue to depreciate,” says Nelson.

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