Fat pockets: seven simple strategies for building wealth
Essence

So many people feel intimidated when they deal with money. We sisters often carry additional emotional baggage, too. We may come from backgrounds where there was never enough--where the lesson we learned was that only certain folks had the know-how to make and grow money. Nonsense! The only thing keeping most of us from financing our dreams is fear. Perhaps we've heard stories of the grandmother who lost her life savings during the Depression or the neighbor who went bankrupt. Let's reframe fear as an acronym: False Evidence Appearing Real. If we can acknowledge our fears, we can address them with facts and take steps to secure our financial future. Money expert Valerie Coleman Morris tells us how to get started:

1 Take the mystery out of money. Managing money is not just the province of banks, boardrooms and business schools. I like to have what I call living-room conversations about money. We need to cozy up to financial issues and make them familiar. While wealth building is a concept many African-Americans are just beginning to understand, when we read, listen, learn--then share what we've learned--we demystify money.

2 Simplify your spending plan. One question I often hear from Black women is "How do I do a budget? I've never been able to follow one." My answer? If the term budget makes you cringe, don't bother with creating a formal one. Just keep a small notebook in your pocket or purse, and every time you buy anything or pay a bill, write it down: pack of gum, 75 cents; cafe latte, $4.25; and so on. At the end of each month, get out three highlighters--pink, yellow and blue. Scan your list and highlight in pink any expense that's mandatory and fixed, meaning it costs what it costs and there's no way to get it cheaper (the mortgage, the car payment, your child's tuition). Then take your yellow marker and highlight those necessary variable expenses (groceries, gas, phone, clothing, meals), where you have some wiggle room in terms of economizing. The blue items should reflect your discretionary spending, meaning goods and services that are nice to have but could be cut out or cut down (travel, manicures, movies, cable TV and so on). You're not looking to completely eliminate these items. Everybody needs a little luxury, but it doesn't have to be a $2,000 vacation; it might be a $400 weekend getaway. Too many Black folks have a bad case of "the blues" when it comes to money. And the reality is, we're not cash poor, we're asset poor. We don't have a savings problem, we have a spending problem. We spend a lot of money but don't have the assets, such as property, mutual funds and other investments, to show for it. Color coding your expenses gives you a quick and easy snapshot of your spending patterns. The blue and yellow areas are zones of opportunity. Set a goal to reduce those expenses the following month, and you'll start to see more green.