Types of Financial Planning

The topic of finances can be a difficult subject to broach, as for many, money is not the easiest thing to come by, let alone speak about without either being seen as a bragger or a substandard citizen. When we make the decision to invest or spend our money on things that will build equity, there is so much advice on the World Wide Web that sometimes it’s hard to tell who is being genuine and who is simply looking to scam their audience.

It’s no coincidence that finance videos on YouTube do so well—on one hand, people want to make more money to afford their basic needs, and on the other hand, people want to invest to begin their journey of building generational wealth. The most important thing to know is that generational wealth begins with ownership—whether that’s owning a car (making payments until it is paid off), starting a business and never selling to corporations, or avoiding inviting investors and shareholders to take control of your board. Lastly, of course, is homeownership.

Although, this is easier said than done, because there are a number of new developments being built with HOA associations that will no doubt come with restrictions. If you’re looking to rent one of your homes to earn additional income on the side, doing so in an HOA-regulated property can prove problematic. But this is something that many homeowners are not privy to, and so they embark on the homebuying process only to end up with a few properties, many of which they cannot use to garner additional revenue.

So, what’s the solution? First of all, please do not run to YouTube seeking answers to important topics such as this that require not only your money but your time. One mistake today could cost you thousands later on down the line, and if not you, your family members or children. Financial planning can take years, and our government knows that. This is why topics like credit card utilization, investment portfolios, stocks, and more are not taught in public schools in destitute or some middle-class neighborhoods but are taught in schools where the wealthy send their children to learn.

THE IMPORTANCE OF OWNERSHIP - Ever wonder why so many entertainers or lottery winners go broke after a short period of time? It’s because they lack financial literacy and own nothing. Recently, comedian and actor Kevin Hart abruptly shut down all four of his Hart House restaurants. The fast-food vegan restaurant was not popular due to poor marketing on his behalf.

But you see, it was the one thing he owned, and yet he allowed it to fail miserably. However, the projects he is paid to star in or promote are at the top of his priority list. When there’s a new movie coming out, he’s doing press runs and making appearances, but something that was his to own—where he wasn’t someone else’s employee—was sent to the bottom of his to-do list, inevitably leading to its downfall.

Mielle Organics Hair Care is another brand that was formerly owned and operated by an African American woman named Michelle Rodriguez. She eventually sold the company in January 2023 to Procter and Gamble. As part of the deal, Mielle and Procter and Gamble donated $10 million to Mielle Cares, a nonprofit that supports Black and brown communities by providing resources for education and economic opportunities.

However, by August 2024, the brand came under fire for allegedly causing balding and shedding of Black and brown women’s hair. Michelle has since made a public statement citing that the ingredients of her products have not changed since the acquisition, but this remains untrue, with users comparing the original ingredients to the updated list now found on the products.

Needless to say, selling the company seemed like the better choice at the time, given the larger financial impact it could have on the communities. But now, it may not appear that way. Not only is trust broken between Mielle and its audience, but there also seems to be no conversation surrounding the men and women in the aforementioned communities who have received assistance from the nonprofit.

A report by The Guardian states, “Median wealth of Black Americans will fall to zero by 2053.” This is in part due to members of the community owning nothing. Once they are in a position of ownership and it's doing well, they immediately sell. Selling only widens the wealth gap, not closes it.

"Last year, a media agency was interested in purchasing She’s SINGLE Magazine—the website, the publication, all of it—for a measly $802,000. I immediately declined. I have no intention of selling my company—none of them. My children’s children will one day own it and run it, and I will make it very clear that they are never to sell," says Lisa K. Stephenson, Owner and Founder of ASIAS Brands.

When asked about her vehicles and home, she said, "I own my 2014 Lexus and will not purchase, lease, or finance another car. I am in the process now of building my dream home alongside my wonderful architects and our family accountant. I purchased the land a few years ago and just paid the taxes until we were able to get all of the permits approved to start building.

My mother migrated here from Jamaica and owns a multi-family house in The Bronx, so the plan is to rent my old apartment there and the basement, and let my mother live off of that income while I enjoy my newly built property once it’s done. I lived in an apartment at my old house for ten years. This allowed me to save, help my mom, and just be grateful that when she was younger, she was smart enough to buy the type of home she did so that we—my brothers and I—could rent out spaces in it until we were financially stable enough to go off on our own."

TYPES OF FINANCIAL PLANNING

RETIREMENT PLANNING - This is the first step to consider because no one wants to work for the rest of their lives. You also want to travel and enjoy the world while you’re still able to do so. Ensure you’re contributing enough to your 401(k), IRA, and other retirement accounts, especially if business ownership is not in your plans. Also, look for companies that match your 401(k), and if they don’t, the salary should compensate for it.

In other words, if you’re investing $400/month into a retirement savings account, but the company isn’t matching it, seek a job where that $400 is added to your salary. For example, if a job offers you $32,000 a year and you want to save $400 a month for retirement, consider negotiating for a higher pay rate if they won’t be matching your 401(k). These are questions to ask during the interview process for nearly any career. Once you graduate and begin your career hunt, retirement options should be discussed in detail; otherwise, you might work in vain.

INVESTMENT PORTFOLIO REVIEW - Rebalance your investments to align with 2024 market trends, economic forecasts, and your long-term financial goals. AI, e-commerce, healthcare tech, and cannabis are growing industries. Consider buying stock in those areas. Or, if you’re a freelancer and a brand asks you to collaborate, instead of taking upfront payment, ask to be paid in equity.

Affiliate marketing/commissions can be unfavorable and are often a bad business model for the person doing all the work. Unless it’s Amazon, Macy’s, or other globally popular stores, don’t consider it. Either ask to be paid upfront and use that money to invest in the mentioned industries or request equity. If the company you’re promoting fails, they still owe you, and if not, you can take legal action.

TAX PLANNING - Review all your tax deductions and credits. Optimize your taxable income to ensure you’re not missing out on any opportunities to reduce your tax liability. For example, if you have an HSA, contributions made are tax-deductible, and withdrawals for qualified medical expenses are tax-free. Did you also know that if you pay for job-related education—such as courses, certifications, or training directly related to your job or advancing your career—these expenses may be deductible? This could include tuition, books, and even transportation to and from classes.

Job Search Expenses: If you’re searching for a new job in your current profession, job search-related expenses such as résumé preparation, traveling for interviews, and even moving expenses (if the new job is far away) can sometimes be deductible.

Child Care: If you pay for childcare or care for a dependent while working, you may qualify for the Child and Dependent Care Credit, which can help offset some of those costs. Be sure to keep detailed records such as receipts and documentation for any deductions you plan to claim.

YouTubers and online gurus may not share key information like this because their goal is to keep you coming back for more advice. If they give it all away in one video, they wouldn’t benefit much. Keep in mind that you can also attend courses in person from Branndet Marketing Group. Each quarter, there’s a new course in one of these five states: New York, California, Georgia, Texas, and Florida. In December 2024, they will announce their January 2025 curriculum and location, so be sure to visit their website for more details.

by Riley Cook