Research from the Selig Center for Economic Growth indicates that the nation’s black buying power will surge from $688 billion in 2002 to $921 billion in 2008. This means that almost nine cents of every dollar spent will be from a black consumer.
“Young African-Americans are splurging their money on trendy items that are based on their desire to build short-term self-esteem, rather than items that will bring them long-term prosperity,” Linda Spear, President of the mortgage broker firm Motion Financial II said. “This is the type of consumer behavior and thinking that will cause negative long-term affects on our people’s future ability to purchase high price ticket items and investment property,” she said.
Spending money is not necessarily bad, especially if you’ve worked hard for it. The problem is when you either spend what you don’t have or spend disposable income without making sure you have a financial safety cushion.
“It is hard for some students to save. We are in school living paycheck to paycheck. I assume we don’t think about our financial goals because we make enough money to take care of now,” said Antwain Oliver, a fourth-year CIS student from Avon Park.
Making smart financial decisions and saving for your financial future now is just the beginning. According to free-financial-advice.net there are several ways to manage your finances: set realistic expectations, live within your means and rationalize your spending
The concept of “living within your means” seems to be the biggest issue among college students. Living within your means involves three simple steps:
Spend less than you earn
Save what you do not spend
Invest what you save
For those who have a hard time living within their means, the first step is usually the most difficult. In order to put yourself in a financial position that allows you to start saving, you must first take a close look at your spending habits.
Create a mini log of all the items purchased within seven days or even a month. In the log, include purchases from the vending machine, Wal-Mart, corner store, manicures, pedicures and so forth. Do not include monthly expenditures such as rent, monthly groceries, car payments and utilities.
At the end of the time frame that you allotted yourself, calculate and analyze how much you spent. Once this exercise has been completed, you will be amazed at how much extra cash you could have saved.
“In general, college students do not save. We just spend,” said Gina Marie Hopwood, a third-year business student from Pembroke Pines. Spending less is the secret to growing rich on your income. There are two ways to be rich: one is to have great wealth, and the other is to have few wants. The rich stay rich because they act poor, while the poor stay poor because they act rich.
Contact Cherline Pierre at famuanbusiness@yahoo.com