A recent story by the NNPA revealed what most of us already knew. Most Blacks don’t have retirement money or benefits put aside for their retirement. It’s tough to have a retirement plan when you are barely making enough money to make ends meet. We are living from paycheck to paycheck because most companies don’t have retirement plans or we don’t make enough money to invest in retirement plans. So an employee works for 30 to 40 years and all they get is maybe a retirement party.
The alarming thing about this article is that instead of conditions improving, more and more companies that once offered retirement benefits are no longer offering them, or have cutback on the amount they contribute.
In most cases they really wouldn’t have to contribute, just offer a decent 401K plan to their employees, and more information on retirement investments.
According to the National Institute of Retirement Security, 62 percent of Blacks have no assets in a retirement account. Wow. Add to this the fact that depending on which report you use, anywhere from 60 to 75 percent of Blacks in this country are considered to be low-income.
I know, a lot of people are going to criticize Blacks for not saving, not putting money aside. In other words wasting money. Yes, there are some in this category, but the vast majority are barely making payments on their necessities such as rent, utilities, food, clothing, household needs, and medical. And heaven forbid if their place of employment doesn’t provide health care. With the new Affordable Care Act, individuals must pay for health insurance as well out of their pockets. Savings is the last thing they are thinking about.
Add to this the fact that in the good old days you could take your money to the bank and deposit it into a savings account and make 4 to 5 percent interest on it because the banks were using our money and making 10 to 20 percent interest on it. Now the banks are using our money but they are only giving us .015 to .020 percent interest. So we might as well put it under our mattresses unless we go to a financial planner or investment broker. And how many of us are willing to do this even if we knew how, or where to go? In many cases brokers will tell you that $1,000 or more is needed to start the investment process plus a fee. Well, who has that kind of money just lying around? One broker looked at me with a straight face while stating that I needed $5,000 to start. I thought he was kidding. I was just starting out.
Yes, we need to start saving for retirement when we get our first job, but it helps a great deal to be working for a company that’s doing it and is willing to have someone help educate employees on how to invest. Schools should be doing more of this as well.
I was fortunate enough to have worked for a company that allowed its employees to invest in stock in the company, which is another kind of retirement plan, and they matched it with a low percentage. For their senior managers, who had been a manager for five years or more, they matched our investment dollar for dollar. This is a rare situation.
I’ve also worked with a company that gives neither retirement benefits nor investment education to its employees, which is the norm.
Other stats in the report stated that Blacks that did invest had an average of $23,000 compared to $50,500 for Whites. Of the 54.3 percent of the Blacks who have access to retirement benefits, only 43 percent are taking advantage of it.
So how do we turn this around? One is to manage the little money we are making better. In many cases it’s not how much you make, it’s how you manage it.
The other, and most importantly, is to get off our sofas, and start joining the few people at community meetings, rallies, as well as work, church, social meetings and instead of talking about people we need to start talking about not only what we need to do to make more money, but what we can do to invest our money more wisely. What can we do to make sure our kids can go to college or a trade school, or what we need to do so that we will have a few dollars extra coming in so when we retire we can retire.
The Black medium income in this country is still nowhere close to our White counterparts. Why is that? We need to find out what we need to do to correct this problem.
We keep talking about how conditions are better, and how we don’t need a Dr. Martin Luther King Jr. anymore, how White folks have accepted us, and that racism is dead.
Well, something is wrong. When the economic gap between Whites and Blacks is so wide, and getting worse over the years instead of better, something is wrong. It’s time we stop just accepting poverty as a way of life and start finding ways to end it. We had better wake up because if conditions are getting worse for White America, we know what that means for Black America.
And what if the Republicans win the White House in 2016?
If we, as African-American people, don’t start working together don’t be surprised to see conditions revert back to the pre-Bill Clinton era or worst. Middle income Blacks must realize that we can very quickly become low income if we don’t help our low-income brothers and sisters.
We as Black people are at the bottom, and we will remain there if we don’t understand that it’s great to fight for Gay Rights, Women Rights, Latino Rights or People Of Color Rights but we must make sure that we don’t get lost in these fights. Because even though everyone else is getting his or hers we are still at the bottom.
(Ulish Carter is the managing editor of the New Pittsburgh Courier.)
