Category Archives: Personal Finance

A Mother Of Three, Two Fathers, A Boyfriend, And 20 Dollars: The Harsh Reminder Of African America’s Financial Existence

Poverty is the worst form of violence. – Mahatma Gandhi


Warning: This story contains images with offensive language.

If you have not heard by now, there is a text conversation (pictured below) that went viral among #BlackTwitter concerning a (assumed African American) mother of three who asked her boyfriend for twenty dollars so her three kids who were not his could go on a field trip since their fathers supposedly did not have it to give her and she did not have it herself. Needless to say people were appalled from every angle. Many men could not believe she was asking her boyfriend to pay for kids that were not his and many women could not believe the boyfriend would not give his girlfriend the money since it was in many opinions – JUST twenty dollars. The two fathers were largely spared much critique aside, but according to the mother neither had it to give her, which is what made her turn to the boyfriend in a last resort. That four (assumed) African American adults could not come up with twenty dollars seems almost unbelievable, but there is a reality that this may have been exactly the case.

The addage that men lie, women lie, but numbers do not maybe quite fitting here. One in four of all Americans have no money in savings according to a recent study by Although the study does not break out race, it is often seen in every statistical category about wealth and income that whatever cold America has, African America tends to have pneumonia. It is fair to say that the likely percentage of African America with no savings is possibly well over 50 percent, but the numbers and story does not end there. A few other economic statistics to note:

  • African American poverty is almost three times the size of the national rate at 22 percent versus 9 percent, respectively.
  • African Americans are still the only racial group making less than they did in 2000.
  • African American median income is $39,490, while America’s median income is $59,039 and Asian America’s median income is $81,431.
  • Average savings account balance for African Americans is $1,000 versus white America’s $7,140 and Hispanics $1,500.

Now, put that last statistic against the average rent in the U.S. as of 2016, which is $1,050 and in essence African Americans exist in a perpetual negative financial existence. That none of those four individuals potentially had twenty dollars to spare is the harsh reality of most African Americans, a situation that becomes even more acute among low-income and working class African Americans whose education and job choices may leave them in a constant state of uncertainty financially. This is to say nothing of the impact that the children’s potential deficit of exposure and beneficial experience the field trip would have provided them, a serious issue worthy of its own exploration when it comes to the development aspect of African American children.

For many of us, the number could change to 50, 100, or 200 dollars and we would find ourselves in a similarly uncomfortable conversation. It also speaks to the lack of support system around this mother and her children from her own family who may also be facing financial angst. There are a lot of layers to this story that much we can be for certain. We can certainly explore the systemic issues and lack of financial aptitude that face our community and the like, but what we should not be is quick to judge any of the individuals in this situation without truly understanding the full breath of our community’s reality.



Personal Finance Tips From Warren Buffett


The HBCU Money™ staff also adds some commentary to the subjects of Mr. Buffett’s quotes to provide more depth and better understand the points.

  • EARNINGS: There are three different types of income. Earned, passive, and investment income. Guess which is taxed the highest? The one you go to work for. Passive income (e.g. rental property, limited partnerships, intellectual property) if properly managed can be taxed at near zero income. Investment income (e.g. dividends from stock ownership) falls under 0, 15, or 20 percent based on taxable income. More importantly, these incomes are not based on you leaving the house or your boss liking you.
  • SPENDING: It is not how much you make, but what you do with what you make. There is nothing wrong with having nice things, however, in an era where people do things to project a social media lifestyle, keeping up with the Joneses, Smiths, and everyone else has become even more problematic. Use personal finance tools like or others to help you track your spending and give yourself a grade on a month by month basis.
  • SAVINGS: Why is it so hard? Wages have been flat for a long time that is for sure, but we must play the hand we are dealt. The question is does pride get in the way of many people saving.  Most people’s biggest expense is housing, yet how many are willing to take on a roommate or two for a year or two to save? Saving must become a habit that can start small and snowball with time with discipline. Find a friend and compete with them if that helps, but find the thing that pushes your button to do it.
  • RISKS: Are you 50/50 about a coming raise and decide to buy that car you always wanted or put that foreign vacation on the credit card? Then you just failed at risk management. Risk is always about understanding the pros and cons of any financial decision and finding ways to mitigate that risk. You bought the car? Okay, so you Uber and add extra income until you get the raise. If you do not, then keep Ubering. Again, risk management is vital to one’s long-term financial planning.
  • INVESTMENT: When do you need a financial advisor? When you are rich you say? Think again. The moment you have a job you need a financial advisor and probably not just one. Checks and balances (risk management). Is your only investment account your retirement account? There are multiple financial investments to consider from owning stocks, owning a stake in a small business, to even owning land. All of these make up the ingredients that is your financial pie. How one distributes them is up to your own risk tolerance, but you have never eaten an apple pie using only apples. No one thing is going to make you wealthy or preserve it.
  • EXPECTATION: This is something that we must reflect on within ourselves and from those around us. We expect to be wealthy, but is our behavior matching it? Are we surrounding ourselves with likeminded people in our pursuits? We can not expect to be financially sound and surrounded by those who want to go to the mall every weekend. Are we patient with our investments? Or do we chase “get rich quickly” schemes because we have not educated ourselves properly to have the proper expectation of savings, budgeting, investing, and the TIME it takes to accomplish those goals.

Need in depth help on all of the above?

Watch this staff recommended Youtube video by Dan Griffin, CPA entitled “Saving & Investing Basics: A Guide for Young Adults” here.

Be sure to also read HBCU Money’s “Recommending Reading for African American Financial Starters” here.

Moms, Daughters, and Money: A Mother’s Story Of Teaching Her Daughter Personal Finance

“Money is the opposite of the weather. Nobody talks about it, but everybody does something about it.” – Rebecca Johnson


Children never cease to amaze me in the way they analyze their world and my daughter is no different. So one day when she says to me, “Momma, how did Tee Tee get rich?” I was driving at the time and almost swerved into the other lane from laughing so hard at my daughter’s question. “Uhh, honey your Tee Tee is NOT rich, who told you she was?”

According to my colorful child with her rose tinted glasses, she understood that my sister was “rich” because she would buy her anything and everything she wanted no questions asked. My daughter continued to explain to me that she was the only person she knew who had two birthday parties a year (my sister also throws her a birthday party), and always gives her “pocket money”.

What my then six-year-old child did not understand, along with most adults was that she needed to save money in order to buy things she wanted and participate in the activities she deemed of value. From as far as I can remember, any money my daughter received went into a traditional piggy bank. I would catch her at times pulling out the money and counting just the bills. The highlight of her piggy bank “audits” would be when she came across a $10 or $20 bill. Trips to the bank to handle our monthly deposits were nothing more than a comedy show. My daughter wanted to talk with the manager to make sure no one would confuse her money from other people’s money.  She “knew” what her money looked like she would often tell the bank associates. They would offer her the Dum Dum lollipops in the candy bowl.  She would take them of course, but then asked if they would put an extra dollar in her account. They thought she was adorable and cute, but she was dead serious.

Trying to explain money and the importance of managing it properly would be a daunting task when it came to my daughter.  She takes everything literally, so I had to be mindful of what I said to her.  So I started my journey about teaching her about money with what I thought was the most important thing to do: Pay yourself first.

I first explained to her that she should save a minimum of 10 percent of any money she receives. We broke everything down in pennies to make it easier for her to grasp the concept or so I thought. I told her there are one hundred pennies in every dollar and that required her to save at least ten cents for every dollar.  Since her allowance is $5 a week, she is required to save $0.50 a week. According to her however, it would take much too long to buy anything with only saving $0.50 a week. Thankfully, she decided she should save more instead of pressing me for a higher allowance – for now. That is when the discussion of wants, needs and wishes came up.  Maslow’s hierarchy of needs: Physiological, Safety, Love/Belonging, Esteem, and Self –Actualization. My daughter’s hierarchy of needs:  Entertainment, Entertainment, Love/Junk Food, and then back to Entertainment.  

It was important to me as a mother to nurture my child to be well rounded.  I started off when she was very young about the importance of charity and her responsibility in her community by allowing her to join me in my various community activities: soup kitchens, neighborhood clean ups, etc.  She would be my “guest” speaker when I met with my high school mentees. I wanted to infuse in her social responsibility without being esoteric; also modeling how and where her money should be spent.  So how do you get a child of a 70’s baby to understand money: Play a round of Monopoly!

When I sat her down to play, I allowed her to be the banker.  I wanted her to understand that it’s a huge responsibility having to “pay” the players the correct amount of money and to stand “guard” of players who needed to borrow money from the bank. (I do not know about your household, but we gave small loans out to keep the game going at times).  Although she was excited about her responsibility as the banker, all she really wanted to do was roll the dice. It frustrated her to no end to have to stop and pay players $200 every time they passed GO, if they wanted to purchase a property, or any other transaction where the game had to pause to handle money transactions. She quickly said, “I don’t want to have to deal with money, I just want to save it and spend it only when I have to.”  Oh, out of the mouth of babies.

Fast-forwarding three years to the age of 9, my child has become a hoarder of money.  Unfortunately, I may have played an unintentional role in that.  My intentions were to teach my daughter the importance of saving money for the future. My daughter’s interpretation became I will save all of MY money while you spend yours.  She is so obsessed with how she can make money she has thought of schemes to outwit the tooth fairy and actually wants to resell her braces back to her orthodontist when her treatments are complete.

We continuously talk about money.  She is sensitive that our lifestyle has changed over the course of the last year. The largest impact of that change is not being able to visit her “Tee Tee” several times throughout the year.  The cost of an airline ticket for a minor to Michigan is not in my budget anymore, however, she could use some of her savings to visit.  When I asked her if seeing her aunt was a want, need, or wish, she looked me dead in the eye and said “I wish to see my Tee Tee, but I NEED my money”.  Oh, out of the mouth of babies.

Every Little Step We Take: When Should Young Couples Talk Finances?

By Garrick & Maya Kebede

No matter what your friends try to tell ya, We were made to fall in love
And we will be together, any kind of weather, It’s like that, it’s like that….


If only it was this easy to discuss finances in a relationship, Bobby.

Deciding when to discuss money in a relationship is not an easily navigated task. However, sans one’s spiritual values it is probably the single most important conversation any young couple can have.

There is no formula to solve this equation and it will vary depending on the couple and the individual characters involved. For the sake of this piece and brevity we will make some basic assumptions. These assumptions are: Both are adults whom are relatively responsible with respect to money (pay bills on time, save somewhat moderately, etc). These are two adults who have reasonably defined financial goals (paying off debt, not buying more home than they can afford, etc.) If you do not have either of these traits then do yourself a favor. DO NOT GET INTO A RELATIONSHIP UNTIL YOU DO. If you are already in a relationship and lack these traits then DEVELOP THEM IMMEDIATELY.

Now that these assumptions are out of the way lets examine the question at hand.

When should a young couple first discuss finances? For Maya and I this conversation actually began after our first couple dates. I actually initiated the conversation by plainly asking her where she saw herself in 10 years. A little secret about finances is they effect every aspect of our lives so if her answer made no mention of finances, then I would have asked her where she saw herself from a financial aspect over that time. Luckily, for me she made it clear that one of her goals was to pay off her student loans and her only credit card. Once she expressed that intention I plainly stated that I also wanted to have my student loans paid off over that time and was currently sacrificing to pay mine off over the next five years. I then mentioned that another goal of mine was to actually save up six figures by age 40 and become a cash millionaire by age 50. This led to a more in depth conversation about how we were going to accomplish these individual goals. The key things to take away from this conversation were that we both CONFIDENTLY and IN PLAIN ENGLISH stated to each other our primary financial goals EARLY ON.

What are the benefits of this type of intentional conversation?

Being this intentional this early has some surprising tangible and intangible benefits. The first benefit is that it takes pressure off both parties involved later on when discussing things such as budgeting and major purchases such as a home. They have already established an open line of communication henceforth, both parties feel secure with being open and honest. The second benefit is security. It is a secure feeling when one knows that your partner has the same value as you. It gives a feeling of never being apart mentally even if you are miles away from each other physically. A price can not be placed on that. The final benefit is level of respect that other people give you. Between Facebook, blog comments, emails and face to face conversations we have received hundreds of statements from people affirming that what we are doing inspires them set similar goals. In that regard we have created a mini movement that we hope other people join.

Every little step I take, You will be there
Every little step I make, We’ll be together

You Must Have Questions About Car Buying: What We Didn’t Learn In College

By Troia Lyles

While working in the lucrative car business for over 4 years, I’ve come to learn that there are so many consumers that come into the dealership with an idea of their intelligence being higher than most people that work at said dealer. However, the look of confusion when they would sit in front of me (whether as a sales person, finance & insurance manager, or sales manager) was very frequent, and honestly, gratifying.

I loved the conversations that would come up about what they read on some website somewhere that will tell them that, in the car business, we are all liars, and that we just want to take advantage of every person that walks in the door. Well, it is not true. I’m sorry to have to pop your balloon of expectations, but every person that works there has several things in common with you. Some are listed here:

1) They are human.

2) They are working to provide for their family.

3) They are paid for their time that they spend with customers (fairly, and sometimes unfairly).

4) They are expected to understand the business they are in (they must research the brand, competitors, demand for the product, etc.)

5) They are human.

Yes, I repeated one of the points because that is very important to understand. There is a moral aspect in the business of sales (with most people in this business) and because of that, it is not as cut and dry as most “consumer reports” make it out to be. This leads into the point of this article, as well as the subsequent articles in this series that will have different subjects to give you a different prospective and ACTUAL education on what happens when it is time to purchase a vehicle.

So the first lesson is: What is GAP Insurance, and why do I need it!? GAP insurance is an acronym for Guaranteed Auto Protection (and in some companies its Asset Protection). The point of GAP insurance in a nutshell is to protect your money.

When you purchase a vehicle (and in this example I will refer to a new car), the car is expected to have a drastic depreciation as soon as you take possession of the vehicle. In dealership lingo, that means “to drive off the lot”. This depreciation is unavoidable. So this is when “putting money down” becomes important. It is understandable that not everyone has the cash flow to put down a significant amount of money for the purchase of a car. So let’s assume that you will not put ANY money down. In other words you want to finance 100% of the purchase.

This purchase will not only include the negotiated sale price of the vehicle, but it will include the taxes (according to the state you want to register the vehicle), license fees, and dealership processing fees. Dealer processing fees are indeed legal, but still can be negotiated, which I’ll cover this in the series in more detail. Now, take that entire total and assume you will have interest. The interest rate (or APR) of course is determined by your credit.

So you’ve purchased your car! Congrats! Inhale the new car smell, turn up the radio, and pat yourself on your back. You’ve made a large purchase, and in turn, increased your credit portfolio with more purchase power! Then you get into an accident, and you total the vehicle. Your insurance company does their job, and gives you a check for the value of your vehicle. You will look at the check, and look at the principal of your loan and see a huge difference. The value of the vehicle drops usually about 20% (with most American manufactures), and then of course all the other fees that were incorporated at the time of purchase is a part of your principal balance. For most buyers, this delta can range from anywhere from $500-$7000. That is a lot of money. You didn’t have the cash to put down at the time of purchase, so where would you come up with the difference?


One of the biggest misconceptions is how soon can you pay off your loan after a total loss. Most banks require it to be paid off within 30 days. This is where GAP insurance becomes important. It simply pays the difference between the value of your vehicle at the time of total loss and the principal of your loan. Some insurances even pay up to $1000 of your car insurance deductible. (Ask the finance manager that is assisting you with your purchase if this would apply to you).

How much does GAP insurance cost? It usually ranges anywhere from $4-25 per month (depending on the APR). That is incredibly affordable considering the coverage it provides during the time of your loan. When would I NOT need GAP insurance? Usually if you are able to put down 15% or more at the time of purchase, you eliminate the need for the insurance. The reason for that is because the cash down provides “equity” towards your loan. It is bringing down the value of your loan, while the value of your car stays.

How long is the insurance active? If you do decide to include GAP insurance, it remains on your loan until it is paid off. For example, if you open a loan for 72 months, and you pay it off in 72 months, the GAP insurance has been included until the final payment was made. If you open a loan for 72 months, but pay it off early (48 months), the GAP insurance you purchased was for 72 months. Therefore you are due a refund of the 2 years you did not use it.

There are many little things to GAP insurance that can be explained by the finance manager you work with at the time of purchase. However, I am open to answering any additional questions you may have in regards to this program through comments below.

Take care, and as always, be smart.

Ms. Lyles is a graduate of Howard University with studies in Music and Business. Her career has seen her spend time as a financial services manager with one of the DMV’s largest regional auto dealerships where she developed expertise in consumer finances, credit, banking, and loan to value analysis. Currently, she is COO of a regional technology company and Founder/CEO of her own financial consulting firm.