Here at Minority Fortune we spend a lot of time isolating the behaviors of a few individuals with a high net worth in the African American community. While a lot of information has been collected, there is always room for more insight into the bigger picture of wealth behavior from those in the highest wealth bracket. Credit Suisse partnered with Brandeis University’s Institute on Assets and Social Policy to report on the realities for African American wealth-builders. Some of it proved interesting. Some of it was shocking.
Here’s a snapshot of what the report details:
• The top 5% of African-Americans take a relatively conservative approach to decision-making on matters of wealth creation and wealth management. For example:
• The investment portfolios of the top 5% of African-Americans are three times more heavily weighted towards CDs, savings bonds and insurance than the investment portfolios of the study’s white comparison group, and are nearly one-half less weighted towards stocks, bonds and mutual funds.
• The top 5% of African-Americans invest 9% of their non-financial assets in business assets, defined as the total value of business(es) in which a household has either an active or non-active interest. The study’s white comparison group invests 37% of their non-financial assets in business assets.
• The top 5% of African-Americans invest 41% of non-financial assets in real estate outside their primary home, relative to 22% for the study’s white comparison group.
• “Wealth mobility” – the degree to which a population maintains wealth over time or moves into wealth over time – is relatively low among African-Americans and may be a driver of more conservative financial decision-making. IASP’s research shows that around 57% of high-income African-American families in 1984 were still in the top segment of income in 2009, but 8% had fallen into the low-income segment. For high-income white American families, 73% remained in the high income segment and only 1% fell into the low income segment. This analysis is a new analysis of the 1984-2009 data.
• Education is a key driver of wealth among the top 5% of African-Americans. Almost 69% of African-Americans at the 95th percentile of net worth have a college degree, compared with 64% for the study’s white comparison group.
From reviewing this report, it reveals many gaps: [click to continue…]
Did you know that you can blame your financial troubles on co-workers that pass away? That’s been the strategy of choice for actor/rapper Ludacris as he battles with his baby mama Tamika Fuller over child support. As the mother of his child is seeking $15,000 a month in child support, Luda has pulled out all of the typical “I’m barely living above poverty tricks” pulled by the rebellious wealthy. His first laughable claim was that he only earned $55,000 in 2013 and will only be able to pay $1800 a month in child support. The second being that his low earnings is mainly due to the delay of the Fast & Furious 7 installment as a result of Paul Walker’s passing. BET reports that the rapper will receive a temporary break on child support, only paying $7,000 a month while the judge reviews his case.
We haven’t written a letter in a long time, and you’ve forced it out of us. Your stupidity has taken the hardly wealthy stunts to new lows that even resident Grade F models like Terrell Owens or Antoine Walker couldn’t even imagine! We’re aware that your kind likes to procreate haphazardly and then evade financial responsibility for your mistakes. Child support isn’t about your feeling of fairness. The laws are in black and white, and they’re used to award the child the same lifestyle that you award yourself. So, if you don’t like it, you should have wrapped it up. Simple and point blank. Second, your co-worker Tyrese already one-upped you on the jerk meter by [click to continue…]
If you have lost your faith in humanity and came here to have your faith restored, this would not be the article for you. During half-time at a Raptors game, Drake handed out a few pairs of his OVO Air Jordan sneakers. One of the lucky recipients was a female, but the odds of the shoe fitting were probably slim to none. According to Yahoo Sports, Drake comforted her with the following: [click to continue…]
Following up on his offer six months ago, rapper Juicy J selected a winner from his $50,000 Scholarship contest. To give some background, contestants had to create a video and upload it onto World Star Hiphop, where the top 10 would be final contenders for the scholarship. The scholarship contest yielded positive benefits for the recipient, but the submissions were additionally intended to benefit the audience as well. Applicants were encouraged to upload videos of them twerking, or booty shaking, as part of their entry. As a result, this generated a lot of outrage due to its [click to continue…]
Oprah Winfrey got the shock of the lifetime when she patronized a luxury goods store in Switzerland, and it wasn’t from the five-digit price tags either. Oprah had requested to see a $38,000 Tom Ford bag when a store clerk explained that the bag was out of her price range. Instead of proving the sales associate otherwise, Oprah simply left the store. When asked whether she experiences racism later in an interview, she cited this incident as “an incident that people of black or brown color experience daily”.
The Daily Mail quotes the incident:
‘The woman did not want to get down the bag which I wanted to look at. The effort was too much for her. She said to me, that the bag was simply too expensive. And I said: “I want to see it anyway.” Instead she tossed me cheaper bags.
‘I said: “Okay, thank you very much! But [click to continue…]
For a refreshing change of pace, we have Grade A behavior to report on! Rapper Nasir Jones, better known as Nas, decided to use his influence for good to help out a man in need. Stanley Young is an unemployed construction worker with 8 children. The mother of his children passed away a year ago, leaving him a single father. After a fire destroyed their home two weeks ago, Stanley has been staying at a hotel. However, WJLA reports that his deadline for finding permanent housing was August 13 as he will be forced to leave. The desperate father has been working with various agencies, family, and the church in order to avoid homelessness. When Nas heard of the story, he decided to do something about it.
Nas started a campaign on Crowdtilt, which is a crowdfunding site. Nas pledged $5,000, with a promise of putting in an additional $5,000 if the donations reached $20,000. The total at the time of writing this piece reports that the donations are almost at $60,000! We applaud Nas’ actions because they not only brought awareness and resources to aid Stanley Young and his family of 8, but they promote performing random acts of kindness.
Why Didn’t He Just Pay It Himself? [click to continue…]
Lauryn Hill is currently serving a three-month sentence in a federal prison for evading taxes on her 2005-2007 income of $1.8 million. While Lauryn certainly had some colorful excuses to say the least on why she hadn’t been paying her taxes, the judge and the IRS weren’t hearing it. Despite the singer paying up the taxes at the last hour with six children at home, she was sentenced with the prison time, three months in home confinement, one-year probation, and a $60,000 fine.
For someone that proclaims to be highly conscious of the system she lives in, Ms. Hill should know better than anyone else what the rules are. Unless you’re a sovereign, you are living in a system [click to continue…]