America’s past fueled the racial wealth gap we’re experiencing today. This gap represents the distribution of assets between specific groups. Studies show that home-ownership is one of the causes of the current wealth gap. Real estate is a lucrative business, and people weren’t able to get in due to their skin color. Flash forward to today, Black millennial homeownership rates have gone up. But despite this great news, we have to do more. Follow the Profit host David Grasso spoke with Olympian and real estate entrepreneur Lavonne Idlette to discuss the wealth gap’s history and future.
Home-ownership then vs. now
Back then, the complexity of purchasing a home depended on your situation and where you lived. Many cities weren’t allowing Black people to own land, and banks weren’t lending them money. However, some people lucked out. Idlette grew up in a family that owned businesses and land. She told Follow The Profit that her grandfather was a World War II veteran. He received money from the GI Bill, which gave him the funds to purchase his own home.
Now, with the help of technology, people can conduct business online. There is also a way to opt-out of providing your ethnicity; however, Idlette suggests people avoid doing that. If you display your race and they unjustly deny you, you’re able to sue. There are fair housing and equal protection laws that allow you to file a lawsuit against the company. Suing doesn’t eliminate the root problem of racial bias, but at least companies want to avoid these kinds of cases.
Slowing down the wealth gap
Budgeting is essential for closing the wealth gap, but the most crucial thing is income. There are plenty of ways to make money. While careers such as plumbing and lawn care are lucrative, some people still look down on them. So, Idlette noticed the push to go to college, but she considers it a setback. The Black community tends to stress college as the primary contributor to success. While college can be helpful, Idlette says we don’t need it.
Instead, she wants the Black community to embrace jobs that pay well. A lot of us disregard trades as acceptable sources of income. Yet, Idlette knows people who work blue-collar jobs, and they make more money than 80% of investors she knows. Once you have a secure income, you can use that money to build credit. Building credit improves the chances of being approved for a mortgage. Then, once we own real estate, we are one step closer to bridging the divide.
For more relevant conversations with changemakers like Idlette, keep an eye on Follow the Profit and Bold TV.
Follow the Profit with David Grasso is a podcast that uses inspirational storytelling to share the top secrets of the modern entrepreneur. High-profile guests give you insight into how they did it. Grasso also shares crucial money and profit hacks that are not typically taught, giving people the know-how to stay relevant in their careers for years to come.