I can’t remember whether the O’Jay’s sang a bit of “For the Love Of Money” on the BET Awards, but after reading an article in USA Today. I can’t help thinking of a line from the song “Money can drive some people out of their mind.” In this case I am referring to our precarious relationship with savings in general (and retirement savings in particular).
The reality is that many of our folks fear that their money will run out while they still have years to live. Some of these fears may be grounded in fact since both African Americans and Hispanics are less likely to contribute to their 401ks (or contribute significantly less than their white counterparts). Now I don’t think that this comes as a tremendous surprise to us but given the new economic climate we need to re-examine our savings habits (if we have any at all).
The problems arise in many cases because we may contribute to a retirement fund but we run into ‘emergencies’ that force us to withdraw funds. (We are twice as likely to take a hardship withdrawal than whites or Asians.) That’s because sisters may be responsible for not only their own household but other family members as well and are often turned to when others need to be bailed out (sometimes literally, sometimes financially). I am definitely not saying that we have to abdicate that role, but we have to start making the critical difference between an emergency and an inconvenient situation. This is vital because there is a higher likelihood that we may lose our jobs these days. If we do, we’d have to pay back any loans within 60 days of leaving our position. (Not likely for most of us if we needed to take out a loan in the first place). We even have to rethink our actions if we’re taking money out for a good reason, like subsidizing our dream business. Unfortunately, that’s also a calculated risk—especially if the business fails.
So what do we do? It’s time to get real about our relationship with money. We all know people who have a luxury car and live in public housing or spend every dime they have on clothes and designer handbags (or live beyond their means in other ways). Newsflash: that is so over!
What’s sobering is the fact that we’re seeing people who’ve lost decent jobs and subsequently their homes because they didn’t save enough. We need to realize that we don’t need to worry about keeping up with the Joneses, let the Joneses take care of themselves. Instead we really need to concentrate on preparing ourselves for both the emergencies today and whatever may happen tomorrow. Start small but do something for yourself now, this money stuff ain’t no joke.
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