WHERE DO WE GO FROM HERE?

Friday March 28th, 2014 marked the inaugural Summit On Educational Excellence For African Americans.  This PHENOMENAL event was put on by the White House Initiative For Educational Excellence For African Americans.  They partnered with Ebony Magazine (Amy DuBois Barnett) and Morehouse College (Dr. Wilson, President) to bring dynamic thought leaders to Morehouse’s Ray Charles Performing Arts Center for two days of intense conversation about how to close the achievement gap among African American Males.  Just to name a few of the heavy hitters on the panels: Dr. Arlethia Perry-Johnson, Dr. John Eaves, Al Dotson Jr., Jim Shelton, Otha Thorton, and Dr. Ivory Toldson.  There were many more!  The main moderators were Jeff Johnson ( award winning journalist) and David Johns (Executive Director of Initiative) who throughout the conference made sure the panelists gave honest direct answers that would push those of us in the audience toward action!

The topics discussed by various panels were “Challenges and Opportunities Facing Young Men of Color”, “Black Male Success in Higher Education”, “The Benefits of Education and Education Reform”, “College and Career Readiness”, “Cost and Consequence of Gun Violence”, and more.  The reason that I drove five hours down to Atlanta, GA is because after discovering @AfAmEducation on Twitter I have been engaged in their mission of closing the gap for African American Children.  More specifically their priority of increasing the number of African American students who successfully obtain a postsecondary degree, credential, or certificate that leads to a successful career.  The motivation for me traveling all over the country speaking to college students about Financial Literacy is because I know the success that comes with not just getting into college, but crossing the stage at graduation!

The first panel by far was my favorite and the reason that I wrote this blog post.  The first panel should have been titled “This Is Why We Are Here, This Is Our Future!” because on the panel were two high school students Miles Ezeilo (9th grade), Keith Slaughter (10th grade) and three college students Thabiti Stephens, Otha Thorton III, and Joshua Young.  These young men fueled my fire to bring Financial Literacy or more specifically behaving with money into the conversation at the Summit!  Although there was not a panel discussing how money behavior could alleviate or even eliminate a lot of these problems, the first panel brought it front and center.  Morehouse senior Thabiti Stephens who is an entrepreneur himself and the owner of Steps By Stephens a shoe company who donates a portion of its’ sales to help with food insecurity in the Atlanta area actually said the words “Financial Literacy” in one of his comments.  I was already going to ask a question to the panel about the importance of Financial Literacy, but once he said it I understood the need for the subject to be a part of this summit.  This young man along with the other four represent the “dreamers” I speak to across the country.  Students who have ideas that can help others in their community or around the world, but fail to bring those dreams to reality because of financial issues (debt).  Debt or irresponsibility with money could have kept StepsByStephens.com a dream and the money for the food insecure an illusion!  That is why Financial Literacy has to be a part of the conversation when talking about closing the gap and NOT the usual talk about Financial Literacy where people teach students and adults that the credit score is important and a credit card is a tool!  I am talking about showing people how to behave with money.  Showing students and their parents that when you pay off debt you can make money work for you!  When you don't owe the bank money you can save for your child’s college education, you can save for retirement, you can start that business, you can give to that charity that provides quality daycare for low income children, YOU CAN!  Those talented young men were only the beginning.

The next panel consisted of Dr. Perry-Johnson, Dr. Toldson, Dr. Shaun Harper, Dr. Bryant Marks, and Morehouse senior Timothy Spicer Jr. and their task was to discuss “Black Male Success In Higher Education.”  They debunked the common myths about African American male achievement and the true percentage of African American males in college, but what truly caught my attention was a statement made by Dr. Marks.  He said, “what HBCU’s need from alumni is to write checks!”  What made this statement so profound is that first, it’s true, but more importantly the Deputy Director of the White House Initiative On Historically Black Colleges and Universities Dr. Toldson was sitting on the same panel.  The universities that the initiative represents are in dire need for alumni to give back!  Take for example Morris Brown College which is a five minute drive away from Morehouse has at the present time 35 students enrolled and is more that $30 MILLION in debt!  The college is going to have to sell majority of its’ land to stay open!  There is also Bennett College which like Spelman College is an all female HBCU and it is in financial hot water to the point that it had to close one of it’s buildings last Fall.  There are not many all female colleges left, let alone HBCU’s that are all female so it is a situation that needs close attention.  Lastly, there is Howard University and Morgan State University who last Fall seen a drop in students because of changes in the PLUS loans.  Hundreds of students found themselves threatened with dropping out of college because they didn’t have the money to cover the balance they owed.  There were seniors in their last year who had to go home!  These are just a few examples of Higher Ed institutions that are having financial issues and HBCU’s are not alone there are institutions all over the United States going through the same thing.  If Higher Ed institutions want any alum to write a check they should show that alum while they are still in undergrad how to behave with money!  The average student loan debt that a person graduates with is now at $29,000, so these students are grabbing diplomas in red deficit ink!  They go out on their own not understanding delayed gratification which leads to more debt (car loans, house loan, credit cards, etc) and all of a sudden they are up to their eyeballs in debt and have no money to give back to their alma mater who needs it!  I am sure there are plenty of people who have been out of college for over a decade still paying back student loans.  Some critics may say “not everyone graduates with loans.”  They would be right, and I am one of those people!  I graduated debt free and still racked up $48,000 in debt because I didn’t know how to behave with money.  I paid the debt off in 2 1/2 years, but that was lost money for retirement, an emergency fund, or donations to my alma mater South Carolina State University!  An alum who is debt free is an alum who writes checks and writes BIG ONES!  

The last thing that I will touch on from the Summit is the need for more African American male teachers.  A project that Jeff Johnson one of the moderators is the Jeff Johnson Institute For Urban Development which has a goal to recruit and develop 80,000 African American male teachers in 5 years.  Throughout the Summit the same statement was being said “we need more teachers that look like our children especially the male ones.”  The great news is that more and more African American males are going into teaching, but what I fear just like with any other teacher of any race is that the amount of money that they are paid will not keep them in the profession for the long run.  Teachers have an extremely difficult job and they get paid nothing!  I’ve had numerous teachers tell me that they can not get ahead financially because of their salary.  There are groups all over the country fighting for higher teacher pay, but in the meantime show those majoring in education and those who are already teachers how to pay off debt they have and build an eight month emergency fund.  Doing this is not to take the pressure off of lawmakers to do what is right and increase pay, but it is to take the financial burden off that teacher so that they can come to class with a peace of mind and give their best to that student they love to serve!  

I know that this post was much longer than usual, but this event was to important not to show how real Financial Literacy could make a positive impact in majority of the topics discussed.  This Summit was about recognizing the issues, but it also was about ACTION!  My first action was to write this blog post and my next action is to email as many of the over 100 HBCU Presidents to discuss the importance of implementing Financial Literacy (Financial Behavior) at their institutions.  Not just to benefit their undergraduates, but also to benefit their longterm survival!

A special thank you to Dr. Wilson and Morehouse for opening your doors to this event!  A supersize THANK YOU to David Johns and EVERY individual behind the success of the White House Initiative For Educational Excellence For African Americans and @AfAmEducation!

www.Dreamgirlspeaker.com

Will That Be Debit Or Credit?

Recently I returned from speaking at a conference that was solely filled with college women.  I spoke at 4:45PM which meant that I had time in the morning to go to a workshop.  I chose to go to another financial literacy workshop just to see what would be covered.  The speaker was doing great, she was talking about saving money, and doing a budget, but then the workshop took a turn for the worse.  She started talking about credit cards and not just talking about them, but actually being their biggest advocate.  I was squirming in my seat fuming over the advice she was giving these young ladies.  She started off by saying how she has own a credit card since she was eighteen so she has been using credit cards for twenty years.  From there she told them they need a credit card to book a hotel room, rent a car, and to build credit so later they can get a mortgage.  By this time I had launched into the orbit of anger because as financial speakers we were here to show these ladies how to start their lives on a financial strong foot and here this advice was about to put them in a debt trap!  Most of these college students are already in student loan debt so why tell them to borrow more money by using credit cards? 

To address the above lie about everyone needs a credit card I will start out by saying any transaction that a person uses a credit card for a debit card can be used.  With the hotel room and rental car booking you can give your debit card and the only difference is that the hotel or rental company will put a hold on the card or go ahead and take the amount from your bank account.  Some say to me I can’t afford to have them put a hold on my card!  My reply to that is “you should not be staying in a hotel or renting a car if the money is not readily available.”  How about the statement that you need to use a credit card to build credit so you can get a mortgage?  Also a lie because if you actually go to a company that underwrites mortgages they will look at more than a credit score and you will get approved.  They look at how long you have been at your current place of employment, do you pay other bills on time, do you have a 20% down payment, etc.  They look at the whole person instead of at a number and let’s talk about that number.  Your FICO score is a ridiculous score to care about if you are trying to win financially.  Look it up online and see what it represents.  35% represents how long you have been paying on DEBT, 30% is based on the DEBT you owe, 15% is the length of DEBT history, 10% is based on new DEBT, and 10% is based on types of DEBT used.  Why should anybody care about a score that keeps you from being wealthy because you are always paying YOUR money to someone else? 

Now some people think they can stump me by saying that they have a credit card that has no annual fee and that they pay their bill off each month so they never are penalized with the interest rate or late fee.  What they don’t realize is that it has been proven that people with credit cards spend 40% more than if they would have used their own cash.  So they are still losing with that credit card.  Here is an example in my own life.  I use to work for a company that gave every employee a credit card for company expenses and so I thought I would be smart and pay the annual fee and rack up points off their money.  I wanted to use my points for a free flight and so this is how the credit card company gets over.  I had to spend $25,000 to get the 25,000 points needed for the free flight not to mention the $80 annual fee that paid at the beginning of the year.  $25,000 for a flight, I don’t think that is a fair trade.  Neither you nor I can outsmart the credit card companies and that is why they are a billion dollar industry.  Be smart with your money and next time say debit please!

Does this post change your outlook on credit cards?