</a>With 2010 logged into the history books, it’s time to look forward to the future and the people, places and things that will shape our world for the next 12 months. Over the course of this past week, <strong>BlackEnterprise.com</strong> gave you the 4/11 on some of the<strong> <a href="http://www.blackenterprise.com/2011/01/04/11-eco-friendly-cars/">big innovations</a></strong>, <strong><a href="http://www.blackenterprise.com/2011/01/05/411-leaders-of-the-new-school/">people</a></strong> and <strong><a href="http://www.blackenterprise.com/2011/01/06/11-things-to-enrich-your-life-in-2011/">trends</a></strong> on the horizon for 2011. For our final list, we spoke to senior equity analyst Earnest White, III, about money, investing and savings advice for the New Year. Be sure to consult your <em>own</em> financial advisor before making a move, but these tips will give you ideas on where to start.</p>
<strong></strong><strong>1) </strong><strong>Don’t be scared:</strong> Wall Street did better than Main Street in 2010 in part because of bailout money—which none of us received. But we can take a lesson from Wall Streeters when it comes to what kind of reaction investors should have to changes in the market. “Wall Street didn’t run away from the stock market or investments just because the economy is bad,” says White. Instead, they looked for other options.“ If the US economy is lagging, then you can look to other countries. But if you're not comfortable investing overseas, you can consider investing in the US debt market (US treasury bonds). Usually the bond market and the equities market move in inverse directions. So if one is bad, a lot of times the smart money goes to the other."</p>
<strong></strong><strong>2) </strong><strong>Watch out for BRICs:</strong> “Right now you’ll start hearing more about BRIC nations (Brazil, Russia, India, China),” says White. “These are the first places people look to internationalyl—the place many Wall Streeters believe show a lot of potential.” Be cautious, though, when exploring foreign markets. “China, for example, is not a democracy, so the laws and rues there may not be the same as in the US. You want to limit your exposure; but international markets are still something to consider.” </p>
<strong>3</strong><strong>) Dump your bad debt: </strong>Paying down high interest debt, especially on credit cards, needs to be a part of your financial plan this year. What defines “high?” White says the definition may fluctuate, but that fact that you should make tackling your debt a priority does not. “No matter what interest rate you have on your credit card, you should pay that down. Interest on your mortgage is tax deductible; interest on your credit card is not. You want to pay down anything that is not tax deductible.”</p>
<strong>4) </strong><strong>Look for the perfect match:</strong> If your company matches at least 3% of the contributions you put in your company 401K, White says it’s a no brainer: Contribute to your 401K. “It’s asinine <em>not</em> to do so. You’re losing money. It never ceases to amaze me how many people don’t take advantage of matching funds.” But if the company that you work for doesn’t have enough investment options to your liking in the 401K, White says once you put in enough to equal the matching percentage, you can consider opening an IRA, which gives you many more options.</p>
<strong>5) Don’t fall for what’s “hot:” </strong>When it comes about jumping on an investment because it’s a buzzed about trend, don’t fall so easily. “I think that may be a mistake a lot of people make, trying to chase the hot industry," says White. "If the novice is lacking the info that Wall Street has, they will always be the last ones in, and they’re usually the ones left holding the bag. Chasing the hot industry is not the right mindset to have. It’s all about slow and steady."</p>
<strong>6) </strong><strong>The rich versus the wealthy:</strong> Chris Rock says there's a big difference between rich and wealthy. (Remember? “If Bill Gates woke up with Oprah’s money he’d jump out a [bleeping] window.”) Maybe not; but White believes the true definition is when you no longer have to work for your money; instead your money works for you, your children, your grandchildren… "If you can invest and have your money yield whatever the prevailing interest rate is on that amount at the time, say 3%, and you can live off that interest, you're on your way to being wealthy.”</p>
<strong>7) </strong><strong>Stop buying up products that are going down:</strong> White says there are different paths to wealth, but one of the key changes we need to make as we enter this new year is to stop spending money on depreciating assets. “Stop on the cars, jewelry, frivolous vacations—until we have a nest egg. In a budget there is certainly room for these things but that shouldn’t be the majority of your budget—that is if you truly want to accumulate wealth."</p>
<strong>8) </strong><strong>Outpace inflation:</strong> When it comes to savings and investing, White says it’s best to start by saving at least 20% of what you make and then investing a portion of that. If 20% is steep, start with at least 10%. The important thing is that the rate of return on your investment outpace inflation. “Your investments should outpace inflation and taxes. If inflation is 3% and you’re only making 2% on your CD or savings account, then you’re losing 1% every year.”</p>
<strong>10) </strong><strong>Age matters:</strong> If you’re a <strong>BE Nexter</strong> who’s looking to invest, White suggests you pay down the debts first and then start allocating a portion of your income into the equity market. “You can start with blue chip stocks, those companies that you know well, or you can invest in ETF's (exchange traded funds), which mimic whatever industry, index or country you’re trying to match. If you’re headed toward retirement, play it safe. “You don’t want to be 62 and have to experience the kind of correction that we’re having now in the stock market,” says White.” You want to have money in savings accounts, CDs or high grade US treasure bonds when you’re seven years or so out from retirement.”</p>
</a>11) </strong><strong>The truth about saving:</strong> When it comes to savings you have to do what makes you comfortable. But the more, the better. There was a time when people said that having six months worth of your expenses in emergency savings was adequate. Now, most advise 9-12 months. “What I was taught is to save a third of your paycheck,” says White. “At least do 10%—but that’s just for your savings; not part of your investment.” If taking money out of your paycheck and placing it into your savings each pay period is difficult for you, White says to arrange for the money to go into your savings directly—this way you never see it and don’t have to touch it. “Put it in your savings account and forget about it—until you need it.”</p>
<strong><em>Get more money management tips:<strong><a href="http://www.blackenterprise.com/2010/12/21/get-out-of-debt-checklist/">Your get -out-of-debt checklist</a></strong></div></li> <strong><a href="http://www.blackenterprise.com/2011/01/06/5-steps-to-a-richer-2011/">5 steps to a richer 2011</a></strong></div></li> <strong><a href="http://www.blackenterprise.com/2010/12/09/mellody-hobsons-5-money-management-tips/">Watch: 5 money management tips from Mellody Hobson</a></strong></div></li> <strong><em>And get more of the 411 for things you need to know in 2011:</em></strong></p> <strong><a href="http://www.blackenterprise.com/2011/01/05/411-leaders-of-the-new-school/">4/11: 11 People to watch in 2011</a></strong></div></li> <strong><a href="http://www.blackenterprise.com/2011/01/06/11-things-to-enrich-your-life-in-2011/">4/11: 11 Life-altering trends you need to know</a></strong></div></li> <strong><a href="http://www.blackenterprise.com/2011/01/04/11-eco-friendly-cars/">4/11: 11 of the hottest eco-friendly cars </a></strong></div></li>
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4/11: 11 Ways to Get Your Money Right for the New Year
![6) The rich versus the wealthy: Chris Rock says there's a big difference between rich and wealthy. (Remember? “If Bill Gates woke up with Oprah’s money he’d jump out a [bleeping] window.”) Maybe not; but White believes the true definition is when you no longer have to work for your money; instead your money works for you, your children, your grandchildren... "If you can invest and have your money yield whatever the prevailing interest rate is on that amount at the time, say 3%, and you can live off that interest, you're on your way to being wealthy.”](http://cdn4.blackenterprise.com/wp-content/blogs.dir/1/files/2011/01/golden-egg.jpg "golden egg")
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