Black Money Education from Finance Professor Dr. Boyce Watkins

Quoted from http://blackmeninamerica.blogspot.com/:

Black Men in America

When it comes to money, there is a lot of hoopla.  As I witness the financial frenzy that comes with each fad, I am reminded of the days of snake oil salesmen, taking advantage of the hopes and dreams of many to fill the coffers of the immoral.  When I watch the late night “Get rich quick” schemes, I wonder if anyone is getting rich other than the professional, perpetrator or pastor selling the book being featured.  Some of the advice shown on television isn’t bad, but as a Finance Professor, some of the advice makes me shudder.   Not to say that all of the self-proclaimed “financial experts” are immoral or incorrect, but it is not hard to find flaws in their perspective.

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The Media and Your Child

Do you know how much the media is influencing your child? Many parents don't understand the negative impact that television, music, magazines and movies may have on their children. Do you?

Parenting is harder today than ever before because your child is being bombarded with violence, sex and a lack of values. Today, with cable and satellite television, children have a huge choice of TV stations. Maury Povich, “judge” shows or other reality television are now what's "on" when most children get home from school. Is your child watching?

The average household in the United States watches over 8 hours of television a day and 40,000 commercials a year. That’s a lot of television and over 300 hours of commercials. Commercials are generally made to sell something and sex sells. 70% of television programming includes sexual content but only 14% of shows refer to sexual risks or responsibilities. With those kinds of statistics, it shouldn't be a surprise that children who watch more television have a higher probability of engaging in early sexual activity. Those same children are more likely to become obese and prone to violence. Society today has virtually no moral bottom; and that's what is reflected on television, movies and in a great deal of music. If you don't instill the values in your child, they'll pick them up somewhere.

You can't stop the media from enticing your child, but you can limit the exposure and gain more control by doing the following;

- Manage the monitors in your home by setting daily limits for TV, video games and the Internet.
- Know what video games your children play and what Internet sites they visit.
- Provide balance by supporting non-monitor activities such as reading, puzzles and board games.
- Communicate and live your values while managing your child’s expectations.
- Set limits, enforce them and be consistent.

Your role is vital in managing the media to which your children are exposed and you can't leave that job to your children. You should be your child's role model and you must be the example you want your child to see. More often than not, your children are a reflection of you. You may be the difference between your child being a success; or just being. Manage those monitors and instill the important values in your child so Jerry Springer doesn't have to.

Most of it is up to you. You can do it!

"You may be disappointed if you fail, but you are doomed if you don't try."
Beverly Sills

Maurice Arthur is the author of "A Black Man Thinking: Volume 1 – Raising Children."
ISBN: 978-0-9788340-0-5

Black Money, Black People: Blinded by the Black Bling

by Dr. Boyce Watkins

When it comes to diversity and integration, I have some critics. I created a website called YourBlackWorld.com, a website for African-Americans. The site was created in response to my experience dealing with mainstream media, which typically provided a 1 or 0 dimensional perspective to black points of view. Although I have a PhD in Finance, I was never called by CNN, FOX or CBS to discuss money or financial issues. I was usually called whenever they had a conversation on “black stuff”.

The fact that they saw me as a black man before they could see anything else was no fault of my publicist. A wonderful and energetic woman, my publicist called all the major networks to introduce me as a person well-qualified to discuss the economy, money management, stock markets or global finance. I have trained literally thousands of Suzie Ormans and Wall Street experts through the years, so it was only logical that this be an area that I speak on as a public scholar.

The problem was that many Americans do not see a black man when they envision a financial expert. A black man is more likely to be seen as a rapper, athlete or criminal. At best, they see a black scholar willing to discuss black rappers, athletes and criminals. That became my role with CNN.

I don’t mind discussing black people, for I have a very strong black identity. However, the limitations of my role bothered me a great deal, and what bothered me most was that it didn’t bother anyone else. If anyone else was bothered, it was for all the wrong reasons. I remember having a debate with a black conservative on CNN about why African-Americans have such a negative image in the world. The conservative, buying into some of the basic tenants of white supremacy, truly believed that the reason black Americans have such a negative image throughout the world is because black people simply choose to behave like criminals. He argued that if black people would simply mind their manners and stop getting arrested so much, the media would have nothing to report.

Apparently, this man had forgotten that there are over 30 million black people in America. So, even if 95% of these individuals were to choose to become perfect angels (or engage in what I call “The Good Negro Behavior Protocol”), there will, by simple statistical fact, be at least 1 million individuals doing things that could embarrass the rest of the community. By virtue of the fact that the media’s lens focuses most on those individuals in the black community who engage in embarrassing behavior, it would be these 1 million individuals who receive the most airtime.
I strongly believe in the idea of freedom. I believe that the black community has a right to be as diverse as any other group of people in America. Rappers have as much a right to exist as professors do. The idea that we can get angry at rappers because CNN and other networks focus on rappers more than anyone else is not the fault of the artists, but rather, due to the one dimensional perspectives of the networks themselves. It’s not who is in front of the camera, it’s where the camera chooses to focus itself.

Another problematic dimension to the “good negro behavior protocol” is this idea that all of us should be “embarrassed” when there is a black person on TV behaving in a comical or criminal fashion. I hear educated African-Americans speak of how embarrassed they are by the behavior of Flavor Flav, the ex-rapper turned reality TV star. I personally find Flavor Flav to be funny and I feel that he has as much of a right to be himself as the white guys on the great MTV show “Jackass”. I have never once heard a white man express that he is embarrassed for the white population because of what the guys on Jackass do on television. I have never once heard a white female say that she is embarrassed for the white race when Paris Hilton is arrested for drunk driving for the 1,000th time. The reality is that they know clearly that Paris Hilton and Jackass do not represent the white experience or dominant white expression.

For some reason, black people are the opposite. Rather than questioning why the media gives us an either-or reality for how we express ourselves in media, we get angry at one another for choosing to express ourselves in a unique fashion. The truth is that Flavor Flav has a right to be a comedian, he has a right to be a jack ass. If anyone in the world watches Vh-1 and thinks that all African-Americans behave like Flavor Flav, then their ignorance is their problem, not mine.

This was an excerpt from the book "Blinded by the Bling: The Plight of the Black Middle Class" by Dr. Boyce Watkins, set to be released August 15, 2008. For more information, please visit www.BoyceWatkins.net.

Boyce Watkins: Educational Thought of the Day

I recently gave a speech at Stanford University for the Black Student Union. We were going to talk about educational empowerment and “black people stuff”. The Stanford University campus possesses, as expected, some of the more brilliant minds in America. It also has its share of stuffiness and elitism, as many such campuses do. I have personally been a believer that education is what you make of it. A person at a community college who studies for 10 hours a day is, in my opinion, far more capable than a student at Harvard who studies for 4 hours a day. The key to your greatness lies inside your heart, not in the walls of the institution you attend.

Reading

With all the advances in the United States today, the reading levels of our children is one area where we haven’t made the advances that are critical to our future. Children’s reading levels are representative of their parents reading activities and of the literacy issues facing many Americans.

The major danger is that reading is the great equalizer and many parents are missing a chance to greatly increase their child’s chances of success. Reading will significantly enhance your child’s chances of success and can put you and your child on the same level with just about anybody, anywhere. Reading can take you places you’ll never go and help you see things you’ve never seen before. Reading can educate the uneducated. Besides, reading can be fun!

“Reading is to the mind what exercise is to the body.” - Joseph Addison

Parents who read often have children that read, and this is a huge area of opportunity for parents. Far too many parents aren’t reading and neither are their children. So how often do you read?

A reader or non-reader, opportunity is all around you. You should be the role model for your children and with reading, it’s no different. If you enjoy reading, and consider yourself a reader, there’s a good chance your child will be a reader. And if you’re not, consider any of these ideas to get you started;

- Go to your local library and get a library card. While you’re there, ask about any reading programs; or set a goal to read a book every two or three weeks.

- Determine a subject of interest to you, and read a book on that subject.

- Find a place that you would like to learn about or visit, and read a book about that place.

- Something that you would like to learn to do, read a book on it and try to do it.

- Have a family reading time without the television.

And if you need assistance with your reading skills, seek out a literacy program at a library near you. The key is to find something to read that is interesting to you. More important than what you read is that you read!

Before you know it, you’ll discover all kinds of things that you wanted to know, and that’s only the beginning. Your child will become a reader with you as a role model. Reading can give you hope. Reading gives you the ability to learn. Reading is one of the most precious gifts that you can give your child.


Maurice Arthur is the author of " A Black Man Thinking: Volume 1 – Raising Children"
ISBN: 978-0-9788340-0-5

529 College Savings Plans: Tax Advantages for Your Student

Worried about the high cost of college for your children? This concern is certainly legitimate. On average, the cost of a college education rises by twice the rate of inflation. However, the fear of a cost increase can be mitigated if parents and students are aware of the tools available to help them cover the expense.

The 529 prepaid tuition and savings plans are among the weapons parents and students can use to cover the cost of college tuition. The 529 plans, also known as “qualified tuition plans” are designed to encourage families to save for higher education. They provide incentives to save, and also allow for additional financial and tax benefits that can make the process easier for families who plan ahead. All 50 states sponsor at least one type of 529 plan, so there are options available for any citizen in any state.

Note that there is a difference between the 529 prepaid tuition plans and the 529 college savings plans. The 529 prepaid tuition plans allow parents and students to purchase credits for tuition at a chosen university and sometimes even room and board. The price of tuition, room and board is held fixed, with no inflationary changes for the duration of the investment (in other words, the cost of tuition doesn’t change for you like it does for everyone else). Most of the plans are sponsored by the state government and also have some kind of residency requirement. In exchange for meeting these requirements, the state government will provide a guarantee for the investment made in the 529 plan.

The 529 savings plans are similar to the prepaid tuition plans, with some mild variations. The plans allow an individual (usually the parent) to set up a plan for another individual (the student) with the goal of paying for the student’s educational expenses. The plans allow plenty of flexibility in choosing the beneficiary, and you can even choose yourself as the beneficiary. The funds are not guaranteed by the state or federal government and you are given an array of investment options for the funds you’ve deposited into your account.
The tax advantages of 529 plans are quite strong. While rules can vary by state, you are not typically required to pay state and federal taxes on earnings from the 529 plan. The only requirement is that any withdrawals from the plan are being used to pay qualified college expenses. Withdrawing the funds to pay for items not related to the cost of college attendance will lead to a 10% penalty in addition to any applicable federal and state income taxes.

Here is a mathematical example to help you understand the financial impact of avoiding taxation on investments in a 529 college savings plan. Assume Teresa invests $1,000 per year in her son’s 529 college savings plan from the time he is born until he is 18-years old. Also assume that her investment earns an annual rate of return of 8%, which is relatively easy to earn on a well-diversified stock portfolio (you can simply ask your investment company to give you a mutual fund that matches the risk and return of the rest of the stock market). She doesn’t engage in stock picking. She just puts her money in a simple mutual fund and leaves it alone.

How much will Teresa have contributed to the account over an 18 year period? $18,000. How much will she have available to pay her son’s tuition when he leaves for college? $37,450. That is more than double the amount she invested in the plan over the 18-year period. Not being taxed on the income gives Teresa an extra $5,000 (roughly speaking) to pay college tuition that she would not have had by investing without the tax benefits of the 529 plan.

One thing that Teresa must remember is the fact that the average tuition increase is 8% per year. So, this increase is going to match dollar-for-dollar the increase in Teresa’s investment portfolio. So, the truth is that she is going to have swim forward just to keep up with the current. This match in growth rates is what makes prepaid tuition plans roughly the same in attractiveness as prepaid savings plans. Had Teresa invested in a prepaid tuition plan (instead of a savings plan), she would have found herself paying tomorrow’s tuition at today’s prices. So, either way, she is going to pay tuition, but investing with tax benefits makes it easier.

My thoughts on the issue? Prepaid tuition plans are the safest bet, as long as you are sure that you don’t want to leave the state to attend college. While you are allowed out of the deal in most cases, there is a penalty for doing so. Savings plans are better for those who want to have a bit more flexibility in attendance options, as well as the chance to possibly outrun the cost of college tuition. Remember: Teresa earned 8% per year on her investment, but the average rate of return on the stock market has historically been around 12%. Therefore, an average portfolio over 18 years would have likely given her more than the cost of tuition.
The key is to remember that the greatest investment in this process is the one in your child. Your child’s greatest investment is the one in his/her educational future. Also, there are a litany of financial aid options available in addition to 529 savings plans. Money should not be a hurdle to building a great future.

Dr. Boyce Watkins is a Finance Professor at Syracuse University. He is also the author of “Everything You Ever Wanted to Know about College”, and “Financial Lovemaking 101: Merging Assets with Your Partner in Ways that Feel Good”. He is also the founder of YourBlackWorld.com, one of the top black news and commentary sites in America.