How To Be A Millionaire by Tony Brown
HOMEOWNERSHIP CAN LIFT YOU TO TOP
(HARD WORK AND EDUCATION ALONE WILL NOT)
new research shows POWER OF ASSETS
by Tony Brown
Bestselling author of What Mama Taught Me (see section on The Millionaires Club)
A strong work ethic and a significant improvement in education -- without some asset accumulation like homeownership -- cannot close the overall well-being (three-quarters that of Whites) gap for Black Americans. This suggests that racial discrimination in real estate and lending markets guarantees a second-class Black population.
For example, no matter how hard Blacks work or how well educated they become, they cannot close the well-being gap unless they significantly improve their accumulated wealth -- home equity, inheritance, savings, stock and other investments. It may also surprise you to find out that because young White families bought their first home, they were able to significantly provide assistance at a crucial stage that advanced the standing of their adult children beyond the merits of their own achievements.
A SILVER LINING
But this new research also suggests a silver lining. It proves, as I have been preaching for years, that “transformative assets,” as these investments are called, is the Black community’s newest and best hope for equality, since income barriers have been steadily reduced over the last 30 years. (See “Black America’s Last Chance” and “Time Has Run Out” at the end of this piece.)
In fact, thank wealth accumulation and higher interest rates on home mortgages typically paid by Blacks for the success of these fortunate White offspring. (The homeownership rate for Blacks is 25.8% less than it is for Whites and 50% of Black families, compared with more than 70% of White families, are homeowners.)
New research: white ASSET advantage
Those are the conclusions of a new study reported in a book, The Hidden Cost of Being African American: How Wealth Perpetuates Inequality, by Dr. Thomas M. Shapiro, a professor at Brandeis (see “How Much Do Blacks Pay For Being Black?” on Tony Brown’s Journal (#2715), PBS and PBS YOU, May 21-May 27). This new research by Dr. Shapiro also explains why each succeeding generation of asset-rich White families will continue to maintain an advantage over asset-poor Black families, not just because of discrimination or better schools, but because financially-strapped Black parents do not have the assets to leave to their children or do not understand the value of intergenerational transfers of investments. Even when the Black parents are equal to the White parents in incomes and education, the gap remains when Blacks are without home equity or other assets.
It pays to love your children.
In my opinion, very important core values are at work here, and they are as important as the accumulation of assets. White advantaged children have been advancing on the shoulders of selfless parents who put their children first. We learn, once again, that the future of our nation’s social and economic well-being depends on how well parents care for and prepare their children for the future. With an awareness of this new information about the role of assets as a competitive edge, a burgeoning Black middle class can now do the same thing -- if real estate and lending markets will treat Blacks fairly and capital is made available by the traditional lenders for Black homeowners.
Conventional wisdom tells us that African Americans suffer an inequality gap with Whites solely because of racial prejudice. That assertion was never entirely true, and now there is research to prove that one very important factor is the structural role that investments play. Even as racial prejudice declined significantly over the past three decades and Black income and educational levels have dramatically improved, the well-being gap between Blacks and Whites remained as a puzzling and stubborn reminder that something else was effecting the outcome.
The advantage that Whites have over Blacks, Dr. Shapiro’s new research shows, has more to do with real estate and other assets, the inherited wealth, that White families give to their children. That suggests that racial discrimination in homeownership may be the number one reason for a plethora of social and economic problems that plague the Black community, and that increasing homeownership can help reduce these problems.
When continuing racial discrimination in crucial areas like homeownership is combined with poor schools and high unemployment, they become an almost insurmountable obstacle for the Black community to overcome. However, the future accumulation of assets that become inherited wealth, such as real estate, can forge a dramatic breakthrough for Black America or any economically disadvantaged group. Now that the Black middle class has quadrupled in the last half-century and Black America has an after-tax income equivalent to the 11th largest nation in the world (and approaching a trillion-dollar GDP), more Black families can shift their investment strategies to ensure a more competitive future for their children. Black families must, of course, focus on inherited wealth for their offspring, such as real estate and other investments. Buying their first home, research shows, is crucial for a family in this delicate process of economic empowerment.)
I have maintained for decades that empowerment for economically disadvantaged groups can only be achieved if they focus on the ownership of real estate as part of a series of market solutions to social problems. Very few influentials in the money markets or community advocates have given my ideas any serious attention. Now this research confirms my longstanding plan for disadvantaged communities to purchase income-producing properties as a way of accumulating equity that can be passed along as an intergenerational transfer of wealth for future generations.
ONE HOUSE A YEAR: $1 MILLION
In my latest book, “What Mama Taught Me,” the reader is shown how to accumulate $1.5 million in equity by purchasing one income-producing property (“wealth homes”) a year in the northeast region (as an investor/member, you can live anywhere in the country) -- under the supervision of mortgage bankers. Entrepreneurial home ownership is only possible with a new definition of success and progress that stresses self-empowerment through “wealth homes” and transfer of property and other asset accumulation to the next generation. “Mama” also lays out the market forces involved in the demand for scarce housing.
At our ongoing free seminars, licensed mortgage bankers explain how to buy and manage one income-producing property a year for 10 years.
The new owner can live mortgage-free in one unit, while using the money from the other one and two units to pay off the monthly note. If there is anything left, the owner keeps it. The Fords, experts at helping customers qualify for loans, also teach the new owner how to find government-guaranteed tenants to ensure a reliable cash flow and provide management services to help the inexperienced.
I call this empowerment program “The Millionaires Club.” This turnkey plan is intended to get one house a year for ten years for each qualified family in our community. In the New York-New Jersey real estate market, the empowered owner can have $1.5 million or more in equity.
TIME HAS RUN OUT FOR BLACKS
Like any self-help effort, the Aframerican community’s self-empowerment must come from market-driven solutions to our social and economic predicaments – that, in relative terms, are getting worse. In this instance, that means the accumulation of “transformative assets” (wealth investments such as home equity) that are passed down to our children to provide them with a sound economic foundation.
If a significant number of families in our community have a substantial investment in home equity, our socioeconomic status will also improve. Black America has not emphasized this road to empowerment and equality. With the new competition from immigrant groups that are more empowerment oriented and more numerous, the result is a loss of jobs and income for Blacks. At the same time, a new global economy reduces the wages of many Americans. Blacks must change course -- now -- from an overemphasis on “leaders” to an unstinting family commitment to the accumulation of home equity.
Our community and nation are about our future -- the children -- not you and me in the present. That old-fashioned belief has proven once again to be the soundest financial advice for future and sustained economic growth.
Tony Brown’s Journal, the longest-running series on PBS, is seen weekly nationwide on PBS and PBS YOU in the U. S. / Caribbean PBS YOU: DirecTV, Ch. 377, Thurs., at 9:30PM and the Dish Network, Ch. 9042, Sat. at 9PM
HEAR Tony on WLS-AM 890(and http://www.wlsam.com) in Chicago Sundays from 10 to Noon (CT).
Go to http://www.tonybrown.com.
(HARD WORK AND EDUCATION ALONE WILL NOT)
new research shows POWER OF ASSETS
by Tony Brown
Bestselling author of What Mama Taught Me (see section on The Millionaires Club)
A strong work ethic and a significant improvement in education -- without some asset accumulation like homeownership -- cannot close the overall well-being (three-quarters that of Whites) gap for Black Americans. This suggests that racial discrimination in real estate and lending markets guarantees a second-class Black population.
For example, no matter how hard Blacks work or how well educated they become, they cannot close the well-being gap unless they significantly improve their accumulated wealth -- home equity, inheritance, savings, stock and other investments. It may also surprise you to find out that because young White families bought their first home, they were able to significantly provide assistance at a crucial stage that advanced the standing of their adult children beyond the merits of their own achievements.
A SILVER LINING
But this new research also suggests a silver lining. It proves, as I have been preaching for years, that “transformative assets,” as these investments are called, is the Black community’s newest and best hope for equality, since income barriers have been steadily reduced over the last 30 years. (See “Black America’s Last Chance” and “Time Has Run Out” at the end of this piece.)
In fact, thank wealth accumulation and higher interest rates on home mortgages typically paid by Blacks for the success of these fortunate White offspring. (The homeownership rate for Blacks is 25.8% less than it is for Whites and 50% of Black families, compared with more than 70% of White families, are homeowners.)
New research: white ASSET advantage
Those are the conclusions of a new study reported in a book, The Hidden Cost of Being African American: How Wealth Perpetuates Inequality, by Dr. Thomas M. Shapiro, a professor at Brandeis (see “How Much Do Blacks Pay For Being Black?” on Tony Brown’s Journal (#2715), PBS and PBS YOU, May 21-May 27). This new research by Dr. Shapiro also explains why each succeeding generation of asset-rich White families will continue to maintain an advantage over asset-poor Black families, not just because of discrimination or better schools, but because financially-strapped Black parents do not have the assets to leave to their children or do not understand the value of intergenerational transfers of investments. Even when the Black parents are equal to the White parents in incomes and education, the gap remains when Blacks are without home equity or other assets.
It pays to love your children.
In my opinion, very important core values are at work here, and they are as important as the accumulation of assets. White advantaged children have been advancing on the shoulders of selfless parents who put their children first. We learn, once again, that the future of our nation’s social and economic well-being depends on how well parents care for and prepare their children for the future. With an awareness of this new information about the role of assets as a competitive edge, a burgeoning Black middle class can now do the same thing -- if real estate and lending markets will treat Blacks fairly and capital is made available by the traditional lenders for Black homeowners.
Conventional wisdom tells us that African Americans suffer an inequality gap with Whites solely because of racial prejudice. That assertion was never entirely true, and now there is research to prove that one very important factor is the structural role that investments play. Even as racial prejudice declined significantly over the past three decades and Black income and educational levels have dramatically improved, the well-being gap between Blacks and Whites remained as a puzzling and stubborn reminder that something else was effecting the outcome.
The advantage that Whites have over Blacks, Dr. Shapiro’s new research shows, has more to do with real estate and other assets, the inherited wealth, that White families give to their children. That suggests that racial discrimination in homeownership may be the number one reason for a plethora of social and economic problems that plague the Black community, and that increasing homeownership can help reduce these problems.
When continuing racial discrimination in crucial areas like homeownership is combined with poor schools and high unemployment, they become an almost insurmountable obstacle for the Black community to overcome. However, the future accumulation of assets that become inherited wealth, such as real estate, can forge a dramatic breakthrough for Black America or any economically disadvantaged group. Now that the Black middle class has quadrupled in the last half-century and Black America has an after-tax income equivalent to the 11th largest nation in the world (and approaching a trillion-dollar GDP), more Black families can shift their investment strategies to ensure a more competitive future for their children. Black families must, of course, focus on inherited wealth for their offspring, such as real estate and other investments. Buying their first home, research shows, is crucial for a family in this delicate process of economic empowerment.)
I have maintained for decades that empowerment for economically disadvantaged groups can only be achieved if they focus on the ownership of real estate as part of a series of market solutions to social problems. Very few influentials in the money markets or community advocates have given my ideas any serious attention. Now this research confirms my longstanding plan for disadvantaged communities to purchase income-producing properties as a way of accumulating equity that can be passed along as an intergenerational transfer of wealth for future generations.
ONE HOUSE A YEAR: $1 MILLION
In my latest book, “What Mama Taught Me,” the reader is shown how to accumulate $1.5 million in equity by purchasing one income-producing property (“wealth homes”) a year in the northeast region (as an investor/member, you can live anywhere in the country) -- under the supervision of mortgage bankers. Entrepreneurial home ownership is only possible with a new definition of success and progress that stresses self-empowerment through “wealth homes” and transfer of property and other asset accumulation to the next generation. “Mama” also lays out the market forces involved in the demand for scarce housing.
At our ongoing free seminars, licensed mortgage bankers explain how to buy and manage one income-producing property a year for 10 years.
The new owner can live mortgage-free in one unit, while using the money from the other one and two units to pay off the monthly note. If there is anything left, the owner keeps it. The Fords, experts at helping customers qualify for loans, also teach the new owner how to find government-guaranteed tenants to ensure a reliable cash flow and provide management services to help the inexperienced.
I call this empowerment program “The Millionaires Club.” This turnkey plan is intended to get one house a year for ten years for each qualified family in our community. In the New York-New Jersey real estate market, the empowered owner can have $1.5 million or more in equity.
TIME HAS RUN OUT FOR BLACKS
Like any self-help effort, the Aframerican community’s self-empowerment must come from market-driven solutions to our social and economic predicaments – that, in relative terms, are getting worse. In this instance, that means the accumulation of “transformative assets” (wealth investments such as home equity) that are passed down to our children to provide them with a sound economic foundation.
If a significant number of families in our community have a substantial investment in home equity, our socioeconomic status will also improve. Black America has not emphasized this road to empowerment and equality. With the new competition from immigrant groups that are more empowerment oriented and more numerous, the result is a loss of jobs and income for Blacks. At the same time, a new global economy reduces the wages of many Americans. Blacks must change course -- now -- from an overemphasis on “leaders” to an unstinting family commitment to the accumulation of home equity.
Our community and nation are about our future -- the children -- not you and me in the present. That old-fashioned belief has proven once again to be the soundest financial advice for future and sustained economic growth.
Tony Brown’s Journal, the longest-running series on PBS, is seen weekly nationwide on PBS and PBS YOU in the U. S. / Caribbean PBS YOU: DirecTV, Ch. 377, Thurs., at 9:30PM and the Dish Network, Ch. 9042, Sat. at 9PM
HEAR Tony on WLS-AM 890(and http://www.wlsam.com) in Chicago Sundays from 10 to Noon (CT).
Go to http://www.tonybrown.com.
posted by Robert at 9:00 AM
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