A black woman has to work seven hours more in order to earn what her male co-worker earns. In addition, black women are more likely than others to have the responsibility of caring for relatives and friends—physically and financially.
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Despite those challenges, black women are starting businesses at a pace that exceeds that of any other group; and those earning more than $75,000 are among the fastest growing income groups in the country.
The Womanomics: Wealth Building for the Ages panel (hosted by Merrill Lynch at the 2016 Women of Power Summit) addressed how black women of all ages can create financial security; now and in the future, by examining saving, spending, debt, and retirement strategies.
Here are a few highlights.
- 51% of women are now the breadwinners in their family; 65% will inherit wealth because men tend to die first. Because women live longer, healthcare and long-term care insurance are critical pieces of their financial security puzzle.
- Don’t take over the family finances—it’s important to keep your husband involved. Racquel Oden, managing director of Merrill Lynch Wealth Management (head of advisor strategy and development) recommends using a behavioral finance questionnaire. “Make it about your mutual goals, about planning for your future together,” she says. “Don’t say, ‘you’re doing this wrong.’”
- Saving for retirement is critical. To save more, to be wealthy, we must spend less.
- Worried about taxes? Carmen Rita Wong, CEO of Malecon Productions, reminded the group that it’s the law to pay taxes. “You need to pay what you owe,” she said, “not a penny more, but not a penny less either.” Wong advised obtaining the services of a CPA if your situation is complicated.
- Donna Sims Wilson, president of Smith, Graham & Co. Investment Advisors LP, stressed that the years we have to build wealth are limited. “If I can’t be compensated what I’m worth, then I need to leave.” Being under-compensated is being cheated, she said.
- What about family members who ask for money? All three panelists emphasized the need to set boundaries.