He’ll Spend A Lot On The “Little” Things: Bottle service in the club for his crew and yours. Three course meals and tickets to the hottest concerts. Weekend vacays just because…it seems too good to be true because it just may be! Unless your dude is an investment banker, a successful lawyer, owner of a flourishing biz or some other big earner, it’s very possible that he’s burning a hole in his credit cards to impress you, to keep up an aspirational lifestyle or because he just doesn’t have much common sense. If what he seems to earn doesn’t match up with what he’s spending on a regular basis, your honey dip may have a little problem with managing his funds.

Read more at Madame Noire …

The frugal and fabulous McNeal

• Blog: The Frugalista
• Niche: Money Management/Personal Finance
• Founder: Natalie P. McNeal
• Twitter: @frugalista

Oftentimes when people hear the word frugal they think of cheap, but not finance blogger, Natalie McNeal, who learned the hard way how to make budgeting a way of life while still being fabulous. After realizing she was sinking in $20,000 worth of debt from credit cards and student loans, the seasoned journalist decided to get disciplined by limiting her expenses for one whole month in 2008 and chronicling it in her blog, The Frugalista. The result of cutting corners on most of her luxuries was saving an estimated $400 and launching one of the most popular personal finance blogs on the Internet. The 35-year old, who lives and operates out of South Florida, has since been a featured money expert on CNN and Martha Stewart Living Radio, as well as being quoted by The New York Times, Washington Post and more. She was also named one of Success South Florida Magazine‘s Top 40 under 40.

Proving that the longevity as a blogger is in brand extensions, McNeal is now the first author to publish a memoir on personal finance in the 62-year history of major publisher, Harlequin Books, which released The Frugalista Files: How One Woman Got Out of Debt Without Giving Up the Fabulous Life this past December. With her practical, honest and witty personal finance advice, McNeal shares her expertise with BlackEnterprise.com as part of our first annual Black Blogger Month. —Souleo

The Frugalista stands out because…

It’s highly personal finance and I share a lot of my struggles and my triumphs to maintain my money. I’m coming from an eye level approach and I don’t preach or rant.

The biggest mistake I ever made in business was…

Not delegating was a mistake. It’s a lot of project management. I have a book, Twitter and Facebook group so it’s not just about the blog anymore. It’s been very hard to juggle all the different media and make sure that I’m reaching people the way they want to be reached all the time.

What I learned from that was…

In order to grow I probably need to bring in an assistant.

Networking has helped me to…

Form relationships. I met my literary agent and got my AOL job through Facebook. I also try to go to lunch and meet people offline. Everything I got has been through networking.

The best investment I ever made was…

A writing course at MediaBistro.com, which taught me about wording in building an online brand. It was $600 but well worth the money.

Building a brand is important because…

It shows that you have a following. People hire you for your skills and those who want to follow what you do.

The best piece of business advice I ever got was…

From my neighbor, who told me to do a little bit of business with people first and then decide to do more. Don’t close yourself off to new opportunities or networking but start small and see how that person works. That way before it gets too deep you can back off if you need to.

I measure my success by…

Honestly, the money. Money talks and my words have a value. I enjoy the media coverage I’ve gotten, however, if you can’t translate that to income then you’re just high profile.

In business, you should never be afraid to…

Take risks. If I hadn’t decided to take that buyout from The Miami Herald [where I was a reporter] and focus full-time online I wouldn’t have a career. After taking a risk I know I can land on my feet no matter what because I have done it before.

Proper money management is important in business because…

You have to do a lot yourself. It’s good to start off yourself and know how much things cost and you need that to grow and to pay employees. So you have to be financially sound yourself.

You don’t have to spend a lot to look good because…

There are too many sales out there. There are samples sales, holiday sales and Groupon. You have friends who can give stuff away and you can be creative with things in your closet.

The one thing money can’t buy is…

A life. You have to find time to go out and enjoy it, which can be hard to do.

Be sure to check out the rest of the digital thought leaders as they’re revealed each day by logging on to BlackEnterprise.com/BlackBloggerMonth.

Money Coach Lynnette Khalfani-Cox (Image: Courtesty of Khalfani-Cox)

The jobless rate. It’s the topic of unwavering discussion these days, especially as it relates to the disproportionately high numbers of African Americans who continue to struggle to find work. But there’s one easy way the government can help reduce the jobless rate–especially for African-Americans: Put an end to the practice of employers discriminating against unemployed job-seekers.

For more than a year, employers nationwide have been blatantly discriminating against the jobless – roughly 14 million Americans – by refusing to consider hiring people who are currently not working, or who have been unemployed for longer than six months or so.

According to numerous reports, if you’re out of a job, you’re out of luck with a growing number of employers whose job postings specify that applicants “must be currently employed” and that the “unemployed need not apply.” This issue has huge implications for African Americans–considering the 15% unemployment rate in the Black community far exceeds the national unemployment rate of 8.8%.

Now comes word that one state, New Jersey, is doing something about this disturbing trend.

Under a new law recently signed by New Jersey Governor Chris Christie which takes effect in June, employers are prohibited from publishing job advertisements–in print or online–stating that the unemployed cannot apply. Violators can be fined up to $1,000 for the first offense and up to $5,000 for subsequent offenses.

The New Jersey law is believed to be the first of its kind in the country. But let’s hope other states follow suit.

In fact, federal legislation banning discrimination against jobless Americans could go a long way toward ensuring that Blacks, women, older workers and others with markedly higher levels of unemployment aren’t unfairly kept out of the jobs market.

In March, Rep. Hank Johnson (D-Ga.) introduced such federal legislation. Although the Fair Employment Act of 2011 is still in committee, the bill would amend the Civil Rights Act to include unemployed people as a protected group, and make it illegal for employers to refuse to hire people based on their employment status.

To its credit, the EEOC is also looking into the matter. In February, the agency held a forum on discrimination against unemployed job seekers. The EEOC hearing resulted after members of Congress urged the commission to investigate the issue.

“At a moment when we all should be doing whatever we can to open up job opportunities to the unemployed, it is profoundly disturbing that the trend of deliberately excluding the jobless from work opportunities is on the rise,” said Christine Owens, Executive Director of the National Employment Law Project, in testifying on the matter before the EEOC.

But in the Garden State, some detractors of the New Jersey bill said the government has no right to tell employers which workers they can and can’t hire – or at least which individuals employers can or can’t solicit in job announcements.

I beg to differ with critics of the New Jersey bill. And so would members of the U.S. Supreme Court.

Continue reading on the next page

While some have had success in the job search, others still struggle. Coudl discrimination be the reason? (Image: Thinkstock)

Members of the high court have consistently ruled that under Title VII and the Age Discrimination in Employment Act, even hiring practices that are neutral or not intentionally discriminatory at face value, can nonetheless be deemed illegal if they affect certain protected classes, such as minorities, women, and older workers.

In this case, African-Americans are no doubt greatly impacted by the practice of hiring only those who are currently working.

But so, too, are women who may be returning to the workplace after childbearing years. Moreover, older workers suffer from disproportionately higher rates of unemployment, so any employer who only hires someone currently working may be inadvertently discriminating against older workers as well.

All of which raises the question: Why the prohibition against unemployed workers in the first place? I’m sure some employers would argue that they’re seeking only the “best” employees, and that someone who’s been laid off, or who’s been out of work for a significant amount of time doesn’t fit the bill.

But clearly that argument can’t be true for all jobless Americans. Many people lose jobs due to reasons completely beyond their control, such as corporate mergers and acquisitions, a department shutting down, or even an entire company going out of business. By screening out these laid-off individuals, employers could be missing out of the opportunity to hire truly talented, skilled workers.

So the presumption that jobless individuals aren’t good, qualified or desirable as potential employees isn’t just discriminatory, it’s also bad business.

Lynnette Khalfani-Cox is a weekly money and finance columnist for BlackEnterprise.com and founder of the free financial advice blog, AskTheMoneyCoach.com. Follow her on Twitter @themoneycoach and see her column every Tuesday on BlackEnterprise.com.

Preparation is key when it comes to financing your education (Image: Thinkstock)

As many college graduates begin thinking about their dreaded monthly student loan payments, the soon-to-be-freshman are tying up loose ends on their financial aid packages, including a large portion of student loans. In fact, Americans have accrued more student loan debt than credit card debt—over $900 billion. The total amount is set to hit $1 trillion this year.

BlackEnterprise.com spoke with Curtis Johnson, president and chief operating officer of Student Funding Group, on why college-bound students should create a budget, how students can lower debt while in school, and the reason parents should let college students front the bill (just a bit).

• PLAN AHEAD
  

The earlier both parents and students prepare, the better. Be sure to adhere to the school’s recommended deadline for filing financial aid or face the prospect of not receiving aid at all.

Parents: Start saving early. It doesn’t have to be a large amount, but anything counts. If your savings can’t go towards tuition costs, at least it can assist with the smaller payments, such as room and board, books or additional fees.

Students: Prepare to work. Even if you don’t qualify for work-study, seek a temporary or part-time job to assist with other expenses. Working before you reach campus can give you a jump start on personal savings.

• CREATE A BUDGET

Every university and college lists the estimated cost of attendance on their website and the figures are updated yearly (if it’s unavailable, it can be mailed or emailed to you upon request). Start thinking about what the family can contribute realistically towards this education. Factor in savings, outside scholarships and all finances separate from your financial aid award. Once a student’s financial aid package arrives—breaking down how much was awarded in scholarships (i.e. merit-based, athletic or departmental), grants and federal loans—the family can determine how much is needed in additional assistance from an alternative (or private) loan.

• MAKE PAYMENTS WHILE IN SCHOOL

It sounds like it would work in a student’s favor to wait until after graduation to start paying down the principal or the loan’s interest, but not so.

“[Students] can at least make the interest payments,” says Johnson. “There’s no penalty for paying these loans early. If they can afford to make the interest payments, we advise students and parents to do that, which is another good way of keeping the cost down on their student loan.”

• PARENTS, TAKE A BACK SEAT WHEN IT COMES TO APPLYING FOR LOANS

Let students get the loan in their name, allowing them to borrow the maximum amount possible through the financial aid award, Johnson advises. Federal loans have a lower interest rate than the PLUS loan, making this a more viable option. If parents want to assist after the student takes the loan out in his or her name, they can do so outside of taking the loan out in their name. Assisting with the interest rate is a better option.

• NO ONE LOAN IS THE SAME, SO KNOW THE DIFFERENCE
  Here’s a breakdown of each type of loan: 
  • Federal Perkins Loans (need-based) – Awarded by colleges to students with the highest need. The interest rate is relatively low at 5% and you don’t make any loan payments while enrolled in school. Undergraduates can borrow up to $4,000 a year, totaling not more than $27,500 overall.
  • Federal subsidized Stafford Loans (need-based) – The fixed interest rate is 3.4% for the 2011-2012 academic year. The government pays the yearly interest while you’re in school. Undergraduates can borrow up to $3,500 for their freshman year, but the limit rises as a student progresses through school.
  • Federal unsubsidized Stafford Loans (not need based) – The interest rate is set at 6.8%. As a dependent undergraduate, you can borrow up to $5,500 minus the amount of your subsidized Stafford, if you have one. That applies for a student’s freshman year; the limit rises as he or she progresses through school. If you’re an independent student or if one’s parents can’t borrow a PLUS Loan, the limit increases by $4,000. You’re responsible for paying interest on the loan while in school, but can capitalize the interest by adding it to the principal.
  • Federal parent PLUS Loans (not need based) – The interest rate is fixed at 7.9%. Parents can borrow up to the total cost of education, minus any aid received.
  • Private (alternative) loans (not based on need) — Rules and stipulations vary depending on the lender

These documents can be useful for tax purposes, as proof of a transaction or payment, or for other reasons. But how long should you keep them? One thing to remember is that federal tax rules require you to have receipts and other records that support items on a return for as long as the IRS can assess you additional tax.

“In very general terms, because the IRS has about six years to assess additional tax if you underreported your income by more than 25 percent, many tax advisors recommend holding all tax records for about seven years, building in extra time for any unforeseen delays in processing your return,” says Rick Cywinski, an FDIC tax policy manager. He also notes that the tax period is unlimited if the IRS suspects fraud.

With tax considerations in mind, here are suggestions.

Credit card and bank account statements: Save those with no tax significance for about a year, but those with tax significance should be saved for seven years.

Canceled checks: Those unrelated to anything you claimed on your income tax form and not needed to show you’ve paid a bill or debt probably can be destroyed after you’ve verified that your bank statement is correct. But canceled checks that support your tax returns, such as charitable contributions or tax payments, probably should be held for seven years.

And, you may want to keep indefinitely any canceled checks and related receipts or documents for a home purchase or sale, renovations or other improvements to a property you own. But once a home has been sold and another seven years have passed, checks related to renovations or improvements can be destroyed.

Of course, many banks no longer send canceled checks, although they may provide copies of the originals. “You can keep the copies of your tax-related checks if you get them from your bank; but if you don’t get copies with your statement, you have some options,” says Evelyn Manley, a Senior Consumer Affairs Specialist at the FDIC. “The most conservative approach is to order copies of important checks soon after your statement arrives,” she says. “Another is to keep the information on your bank statement to order copies if you’re audited in the future because, in general, banks that do not return original checks to customers are required to keep copies of checks for seven years.”

Also, Manley says, if you keep records electronically, be sure to back up your data. You can store it in various ways (on CDs, flash drives), but as old technology is no longer supported, you may need to transfer your data to new media. Another option is to research companies that provide backup storage online (or in “the cloud”). These services are usually provided free or for a small charge.

Deposit, ATM, credit card and debit card receipts: Save them until the transaction appears on your statement and you’ve verified that the information is accurate. You may make an exception for receipts for expensive items. If they are under warranty or you have to file an insurance claim, the receipt may be helpful.

Finally, before tossing away any document that contains a Social Security number, bank account number or other personal information (especially financial information), shred it to avoid becoming a victim of identity theft.

For additional guidance on what records to toss and when, ask your accountant, attorney or another trusted advisor.

Source: FDIC Consumer News

No wallet, no problem (Image: ThinkStock)

Here are four safety tips from FDIC Consumer News that can greatly reduce the chances of becoming a victim in the event your wallet is lost or stolen.

•Limit the amount of confidential information in your wallet. Only carry the identification, checks, credit cards or debit/ATM cards you really need. The rest, including bank account numbers, personal identification numbers (PINs), passwords, and most importantly, Social Security cards, are best kept elsewhere in a safe place. Likewise, don’t pre-print your Social Security number or driver’s license number on your checks, because either one could help a thief apply for a loan, credit card or bank account in your name.

•Keep good backup information about your bank and credit card accounts. You’ll want account numbers and phone numbers that can be used to report your losses or request new cards. “Some people make copies of the front and back of all the cards or important notes in their wallet to help jog their memory,” says FDIC Regional Ombudsman Janet Kincaid.

•Review your credit card bills and your checking account statements as soon as they arrive. Make sure that no fraudulent activity is taking place. Periodically request your credit reports. Look for signs that someone may have obtained loans or tried to commit other fraud in your name. By federal law, you are entitled to one free copy of your credit report every 12 months from each of the three nationwide credit bureaus—Equifax, Experian and TransUnion. Go to http://www.AnnualCreditReport.com or call toll-free 1-877-322-8228 to order your free credit reports.

•If you’ve already been victimized, take steps to limit your liability. Immediately call your bank (to report a lost debit/ATM card) and your credit card companies. And if you spot an unauthorized charge on your credit card, you must follow up on any phone calls to your card issuer with a letter disputing the transaction. “Under the Fair Credit Billing Act, you must dispute unauthorized charges appearing on your credit card statement in writing within 60 days after it was sent to you,” notes Joni Creamean, Chief of the FDIC’s Consumer Response Center. “The letter also must be sent to the bank’s designated address for billing inquiries, not to where you’d mail your payments.”

Source: FDIC Consumer News

On March 30, 2011, BLACK ENTERPRISE Chairman & Publisher Earl G. Graves, Sr. will be inducted into the American Advertising Federation’s Advertising Hall of Fame, the industry’s most prestigious honor. As part of the 63^rd such ceremony, he will join a cadre of icons who have raised the standard for excellence as well as made a significant impact within and outside the industry.

When Graves founded BLACK ENTERPRISE in 1970 it was a single-publication company, defining its mission with this declaration: “Lacking capital, managerial and technical knowledge and crippled by prejudice, the minority businessman has been effectively kept out of the American marketplace. We want to help change this.” His leadership paved the way for the multimedia powerhouse that BLACK ENTERPRISE is today, sharing its “Wealth for Life “ message through an array of digital, print, broadcast and events platforms that reach a total audience of 6 million. His vision and energy have inspired the development of generations of entrepreneurs, corporate executives, investors, inventors–and one U.S. president.

In the beginning, he used his door-busting salesmanship to convince prospective and skeptical advertisers about “the green side of black,” reeling off stats about the nation’s emerging black middle class that included thousands of business people, physicians, lawyers, government officials and trade association chiefs. As a result, he broke new accounts with companies like IBM, Chase Manhattan (now JPMorgan Chase), Mobil (today ExxonMobil), GE and American Airlines.

It was his unyielding commitment to excellence that has fueled BE’s spectacular growth. Today’s readers voted it one of the most trusted and most inspiring publications in the country, according to the American Magazine Study conducted by Affinity, a media research firm.

Graves’ passion for breaking business barriers, developing new profitable ventures and now watching his media empire grow under the stewardship of his son, Earl “Butch” Graves, Jr. is matched by a dedication to the advancement of African Americans, especially young people. His humble roots and humanitarianism drives his philanthropy and mentorship agenda.

Whether growing a company or pursuing a cause, he wasn’t guided by blind ambition or reckless optimism. He had a bold vision, a detailed plan and the fierce determination to make both work.

Click here for a few of Mr. Graves’s business gems and see moments from his incredible journey, his recollections and his life lessons that may help guide you.

Get back into the home you love (Image: Thinkstock)

Many homeowners experience foreclosure as the end of a long, tumultuous process—oftentimes beginning with a job loss. They fall behind on their mortgage payments, perhaps make unsuccessful attempts at a government-assisted loan modification, and then finally accept that foreclosure is inevitable. The average borrower who loses a home to foreclosure has gone 14 months or more without making a mortgage payment by the time their home is repossessed. After a foreclosure, many former homeowners realize that losing their house is just the beginning—they now face the uncertain process of rehabilitating their finances, credit, and self-esteem.

If you’re on the verge of a foreclosure, there are a few things you can do before, during, and after the process to help ease some of the pain:

1) Get a roof over your head. Before your mortgage holder confiscates your home, locate and secure affordable rental housing. This will help ease the transition, especially for any children involved.

2) Boost your income. If you’ve lost your job, work on locating new sources of income, whether through unemployment benefits, a temporary job placement, or part-time work.

3) Regroup emotionally. It’s a tough time for everyone involved, and foreclosure can be especially hard on a marriage. Don’t blame yourself or other family members for your predicament. Commit to working as a team to rebuild.

4) Educate yourself. Now’s the time to learn what you don’t know about personal finance. Learn the intricacies of how loans work. Study how credit scores are calculated. Keep reading BLACK ENTERPRISE.

5) Seek counseling. Many organizations offer free counseling to help those recovering from foreclosure. Try GreenPath Debt Solutions, CredAbility.org, or locate a federally approved advisory service in your area through the U.S. Department of Housing and Urban Development.

6) Draft a budget. With the help of a debt counselor or financial planner, create a budget for your new living and financial situation. Many former homeowners will also want to begin saving for the day when they can buy a home again.

7) Repair your credit. You’ll need to create a detailed plan that includes specific amounts and timetables for attacking all debts, including any residual balances from the foreclosed home, such as utility bills or property taxes.

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Debts aside, things were going well for Norman in other parts of her life. She was awarded a full scholarship to attend law school at St. John’s University. While she didn’t need to borrow money to cover her graduate studies, she did take out student loans during her last year to pay off the credit card debt and to cover living expenses. “I wanted to concentrate on graduating from law school and passing the bar without having to work or worry about my lack of income,” explains Norman. After law school, she turned down a number of lucrative employment offers to take a public defender position at Queens Law Associates PC. Her annual salary is about $55,000.

Norman’s debt struggles are typical of many young college graduates. The misuse of credit cards on university campuses has become so problematic that last year the federal government enacted a law banning companies from issuing credit cards to anyone under the age of 18 without an adult cosigner. Recent studies show that the average college student graduates with about $4,100 in credit card debt and $24,000 in student loan debt. Norman has $19,000 in student loan debt, toward which she pays $300 a month (at an interest rate of 6.8%).

Over the past two years, the 27-year-old attorney has taken great pains to rebuild her credit. She uses a secured credit card, which has a $700 credit limit. Norman plans to apply this year for a traditional unsecured credit card that may offer her a higher limit and lower interest rates and fees.

While Norman’s debt problems aren’t unusual among twenty-somethings, her skill for investing money is uncommon for someone her age. In 2008, with the help of her uncle who is an economics  professor, Norman invested $10,000 of her savings in a handful of carefully chosen stocks. “I’ve made a few great moves and a few not-so-great moves, but I am learning more and more every day about how to research my investments, how to invest intelligently, and how to be patient when investing long term.” To date, her individual stock portfolio is valued at $14,000; she has another $13,000 in a money market account.

In spite of her less-than-perfect credit history, Norman realizes that she is ahead of the curve compared with many of her peers who have newly minted graduate degrees and careers. “I have relatively minimal debt, a secure job that I love, and the potential to realize continued financial success with few setbacks.”

The Advice
Jennifer Norman is on the right path to accumulate wealth, but she needs to diversify the types of investments she makes. Doing so will help maximize her returns and reduce her tax obligations. To help Norman get to the next level, black enterprise and Ivory J. Johnson, director of financial planning at Scarborough Capital Management, devised the following strategies to help Norman manage her finances and grow her assets.

• Use digital apps to budget. Norman often finds herself halfway into a pay period clueless about where her money went. She estimates that her total monthly expenses are $1,800 and her take-home pay is $2,800. Plus, she brings in an average of $1,000 a month doing private legal work. Between her regular paycheck and income from the side gig, she should have nearly $2,000 in discretionary income.

Norman needs to create a budget and follow it, says Ivory J. Johnson. Within that budget, she needs to include a line item or set amount that she will contribute each month toward savings and investments. There are dozens of highly rated budgeting apps she can use. For starters, Johnson recommends iBearMoney, Toshl, HomeBudget, and ProOnGo.

• Open a SEP IRA account. Norman needs to save money in a tax-efficient way, says Johnson, especially since she’s single with no children and lives in the high-cost New York metropolitan area. Norman can continue saving for retirement in her existing 401(k) and use the $2,000 contest winnings to open a SEP IRA to further diversify her investments which will allow her to put aside 20% of her net self-employment earnings. If, for instance, she nets $20,000 from her private practice, she can contribute $4,000 to the SEP and reduce her overall tax liability for that given year. “Invest in some alternative asset classes like precious metals or gold mutual funds, which don’t move in concert with the stock market,” Johnson advises. “Add mutual funds to the asset mix to help balance out the individual stock portfolio.”

• Increase 401(k) contribution. Norman has been contributing only 5% of her salary to her 401(k) plan since she began working in August 2009. It’s currently valued at $2,000. Johnson recommends that she increase her contribution to 10% (or $1,800 a year) and focus on investing in small-cap and mid-cap funds, since the companies within those categories are taking advantage of new technology, tend to be more innovative, and are more nimble in tough economic times than larger companies, explains Johnson.

• Diversify and safeguard equity portfolio. Norman’s stock account consists of six companies mainly in biotechnology and media/entertainment industries. Johnson suggests that Norman broaden her holdings by looking into agricultural stocks, taking advantage of rising food prices and changing global demographics. Although Norman has done a good job building a stock portfolio with the help of her uncle, she also ought to consider mutual funds as a less risky, more diverse way to invest. And she needs to protect her portfolio from possible future loss. Johnson suggests that she set sell-stop orders on her individual stocks to prevent deep, sudden losses. For instance, she can place an order to automatically sell a stock if its price drops 10%.

• Rebuild credit. Norman’s current credit score is 690. Once she has established a new credit history with a new card or two, and begins to pay those bills on time, her credit score will improve into the 700s within a few years. “Call the three credit rating companies (Equifax, TransUnion, and Experian), and get a free credit report for review,” says Johnson.