The Quest for Generational Wealth

Cash Fasting readers; this guest post comes from a dear friend of mine. He’s been a Cash Fasting contributor before and is always willing to talk finances or plan an adventure. Building generational wealth is something we can all relate to, and the lens that Horace is telling his story through is not only relevant but offers a unique perspective that I myself cannot.

“When we reach our lowest point, we are open to the greatest change.”

-Avatar Aang

We made it through 2020, the year to end all years. The year that for many brought us to our lowest point and where we were forced to reckon with some hard truths, myself included. As a Black American, 2020 was a year where I was forced to confront my toxic relationship with debt and money, suffice to say it hasn’t been easy. However, this confrontation has been essential if I hope to embark on a journey to build wealth and create a life for myself that I am in control of.

Coming from a working-class background, no one teaches you about money or gives you a framework for understanding it. All you have are examples of family members working minimum wage jobs while reinforcing the importance of going to college, getting a degree, and ultimately getting a “good-paying” job. Ordinarily, one is able to create a stable life for themselves with this path but as a Black American with my background, the Black Tax complicates this. The Black Tax, for those who don’t know, is the colloquial term for a scenario that a number of young Black professionals find themselves in – using portions of their income to support their families.

This might include:

• Helping family pay off bills and debts
• Helping with everyday expenses like groceries
• Paying their rent (as in my case)

In 2019, when my income increased by $20K so did my financial responsibility to my family. Money that I could’ve used for investing or saved for a house instead went to them. This is after overcoming all of the challenges and systemic barriers that typically hold Black people back from entering the white-collar work environment. Sadly, this is also where the lack of financial education hurts someone with my background. We are taught the importance of being an employee and having a job; other modes of generating income are all too foreign. In addition, growing up I was acutely aware of my Mom’s struggles with debt which made me very debt adverse.

What makes the Black Tax frustrating is that it traps you and makes it difficult for you to be proactive about building generational wealth. The term generational wealth has been thrown around a lot, so I won’t explain it, but what’s important to know is that White people have nearly 10X the generational wealth when compared to Black families – and as a child of immigrants I was literally starting from a base of zero; I had to be the one to create it.

Now, what happened in 2020? Long story short, I grew deeply depressed because I hated my new employer. Ultimately, I realized I hated being an employee. From the climb up the corporate ladder, microaggressions, corporate culture and politics – 2020 culminated in the realization that for the long term I can’t be someone who is working a 9 to 5 until I retire at 65. 

So, to recap we have:

1. The Black Tax
2. Lack of proper education around money
3. Unhappiness in the primary income stream we are traditionally taught to achieve
4. A desire to build wealth, particularly generational wealth

Realizing all of this, 2021 is the year that I decided to learn about money. Now I don’t mean becoming acquainted with the history of money. What I mean is learning about how money can work for you when you save, invest in real estate, invest in stocks, life insurance policies, but also unlearning perceptions of money brought on by past trauma. So far, I’ve relied on a number of resources such as The Minority Mindset Youtube Channel, The Dream Green Youtube Channel, The Motley Fool, and Robert Kiyosaki’s Rich Dad, Poor Dad; these are new tools in my arsenal to build wealth. And, as I continue, I’m sure that I’ll be acquainted with new, more advanced tools.  The journey to generational wealth is just that, a journey.  The Gamestop short squeeze was a great event to witness as we saw many new people enter the stock market, but events like that are rare and aren’t smart ways for building wealth that outlasts you. Unfortunately, there isn’t a silver bullet to wealth.  It takes a change in perception, a change in focus, and a willingness to be uncomfortable at times, but the more you understand how money operates in systems like the Stock Market, a high yield savings account, in real estate investing, in the tax code, the better prepared you’ll be to make informed decisions on your journey to wealth.