“Hope: The New Financial System Emerging After The American Economic Crisis” by Brenda J. Isom shows readers how to recover from the economic crisis and regain their wealth.

Interested ones can order and/or preview the book at www.brendaisombooksstore.com

To arrange a book signing or interview, contact Brenda Jackson-Isom at (408) 799-9384 or brenda.isom@yahoo.com

Conference focused on credit, budgeting and financing higher education

Illinois State Treasurer Alexi Giannoulias’ office held a free money management conference Thursday in Chicago geared toward helping women take control of their finances.  

Smart Women Smart Money aims to empower women financially by providing practical advice and real-life examples of how women can budget, save and invest wisely. The 10^th annual conference, held at the UIC Forum, featured financial experts who led seminars on credit management, budget basics and paying for college. More than 500 people attended the conference.

 State Treasurer’s Chief of Staff Robin Kelly, who spoke during the conference, said it’s important that women help each other further their professional and financial goals. 

 “I’m a huge advocate for education that’s by women and for women. No offense to the guys, but to be a successful woman, you need to stand on the shoulders of other women,” Kelly said. “It’s something I try to do in my life, empower the women around me to be leaders, to make sure they always have a seat at the executive’s table.”

 Keynote speaker Rosie Rios, United States Treasurer, discussed the importance of financial empowerment for women and shared her secrets for success. In addition, two Chicago businesswomen were recognized for their professional accomplishments and community service.

 Leticia Velez-Hudson received the Woman on the Rise Award for her success as President/CEO of Chicago Mini Bus Travel and for her work with civic organizations such as Mujeres Latinas En Accion and A Safe Haven Foundation.

 Merri Dee, President/CEO of Merri Dee Communications, received the Woman of Excellence Award for a career in broadcasting that spanned four decades and for her work as an advocate for children and education.

 SWSM is presented by Dollars and Sense Inc., a nonprofit organization. Major sponsors include COUNTRY Financial, State Farm and VISA.

Recession has worried Pittsburgh residents making long-term changes to manage their finances

Pittsburgh, PA (BlackNews.com) — Pittsburgh residents say the economic recession and choppy recovery have changed for the long term how they handle their finances. Diminishing optimism for the recovery has forced many to take a more hands-on approach to planning for a brighter financial future. To help, Nationwide Insurance is partnering with author and broadcaster Tavis Smiley to bring its On Your Side Tour with Tavis Smiley, a free financial empowerment workshop, to Pittsburgh on October 9 at the David L. Lawrence Convention Center.

The need to address financial literacy and financial planning – including African-American households in Pittsburgh – is highlighted in a new survey commissioned by The Smiley Group and Nationwide Insurance that shows the recession has impacted how Americans are preparing themselves for the future.

Positive Changes

According to the survey, African Americans in Pittsburgh have made more positive changes in the past year than the general population as a result of the economy, including creating a household budget (40 percent to 24 percent), cutting back on eating out and entertainment (67 percent to 55 percent), and delaying non-essential purchases (60 percent to 45 percent).

Hard Times in the Steel City

Eighteen percent of African Americans in Pittsburgh surveyed say they are unemployed, compared to 8 percent of the general population. Nearly half of African Americans in Pittsburgh (47 percent) say they have a household income less than $35,000 a year before taxes, compared to 18 percent of the city’s general population.

The majority of African-American (87 percent) and general-population (94 percent) respondents in Pittsburgh remain at least somewhat worried about the economy. Twice as many respondents believe their financial condition has worsened in the past year than those who feel it has improved. Many don’t believe it will improve over the next 12 months (47 percent African Americans and 58 percent general population).

Other survey findings of concern in Pittsburgh:

* 38 percent of African Americans are unable to pay all household bills (compared to 19 percent of general population).
* 18 percent of African Americans say their employer has reduced their hours (12 percent of general population).
* 11 percent of African Americans took a loan from their 401(k) (6 percent of general population).
* 35 percent of African Americans are struggling with credit card debt (28 percent of general population).
* 41 percent of African Americans are not confident they will have enough money to live comfortably throughout their retirement years, compared to 33 percent of general population.

“The results of the survey underscore that Americans in Pittsburgh – black and white – are struggling to emerge from this downturn on their feet,” said Tavis Smiley. “As the world continues to recover from the recession, Black America has the highest unemployment rates, was heavily impacted by the housing crisis and was hit hard by the credit crisis. These sessions are as timely today as they were when we started the tour two years ago.”

Work To Be Done

When it comes to financial goals, African Americans say paying monthly expenses (34 percent to 21 percent) and paying rent/mortgage (33 percent to 15 percent) are significantly more important to them than the overall general population responded. However, only 4 percent of African Americans say their most important goal is saving for retirement (compared to 18 percent of the general population).

Eighty nine percent of all Pittsburgh residents who plan to build up an emergency savings fund over the next 12 months and say they will continue to do so for the long term.

The free event at the David L. Lawrence Convention Center is open to the public and will focus on economic empowerment and financial planning. It will feature a general session with Smiley as the keynote speaker and two informational seminars with breakout sessions for group participation, and provide other information – including financial basics, employment opportunities and more.

“As America continues to see the long-term impact of the Great Recession, our safety nets are slowly diminishing and consumers are becoming more aware that fiscal accountability and responsibility is up to them,” said Brian O’Dell, regional vice president for Nationwide’s Northeast Region. “Consumers are seeking financial information and tools to help them plan for today and prepare for tomorrow. We view our On Your Side Tour with Tavis Smiley as a way to help people help themselves and make a difference in communities like Pittsburgh.”

About the Survey
The online survey was conducted July-August 2010 by the Blackstone Group. A web panel was used to collect data. A total of 325 residents of Pittsburgh were split into two sample groups: general population, ages 18+ (200 people) and African American, ages 18+ (125 people). Significance testing was done at the 90% confidence level. Margin of error is +5.8% for the general population and +7.4% for the African American population.

About Tavis Smiley and The Smiley Group
From his celebrated conversations with world figures to his work to inspire the next generation of leaders, as a broadcaster, author, advocate and philanthropist, Tavis Smiley continues to be an outstanding voice for change. Smiley is currently the host of the late night television talk show Tavis Smiley on PBS and The Tavis Smiley Show from Public Radio International (PRI). TIME magazine honored Smiley in 2009 as one of “The World’s 100 Most Influential People.”

The Smiley Group, Inc. is a communications corporation established in support of human rights and related empowerment issues. TSG serves as the holding company for various enterprises encompassing broadcast and print media, lectures, symposiums and the Internet. For more information, visit www.tavistalks.com.

About Nationwide
Nationwide, based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the U.S. and is rated A+ by A.M. Best. The company provides a full range of personalized insurance and financial services, including auto insurance, motorcycle, boat, homeowners, life insurance, farm, commercial insurance, administrative services, annuities, mortgages, mutual funds, pensions, long-term savings plans and health and productivity services. For more information, visit www.nationwide.com.

Nationwide, the Nationwide Framemark and On Your Side are service marks of Nationwide Mutual Insurance Company.

New law cracks down on debt settlement fraud 

Springfield, IL – A bill pushed by the Illinois State Treasurer’s Office aimed at cracking down on debt settlement companies that make false promises of big savings while sinking consumers further into debt was signed into law Tuesday.

“For far too long, debt settlement companies have operated like it’s the Wild West out there. This legislation will require that debt settlement companies play by the rules and not take advantage of Illinoisans who are struggling during these difficult times,” said State Treasurer Alexi Giannoulias. “It will rein in these unscrupulous practices and protect the financial health of Illinois residents.”

The economic downturn and high unemployment rate have spawned the rapid growth of debt settlement companies nationwide that claim to help distressed borrowers by negotiating to pay off their debt for pennies on the dollar.

The new legislation prohibits all upfront and monthly fees, except for a one-time $50 application charge, and caps fees at 15 percent of the savings achieved from settling a debt. Prior to this law, debt settlement companies were allowed to collect roughly 15 to 20 percent of the consumer’s total debt upfront, so a consumer who owes $15,000 in credit card debt the company could pay $3,000 upfront before a single debt is settled.

Promising savings of up to 60 percent, debt settlement companies typically told clients to stop paying their credit card bills and to re-route that money into an account that would later be used to negotiate a settlement. This accumulation period took anywhere from 12 to 18 months while fees and interest continued to accrue.

As a result, many consumers were sued by their creditors before settlements were reached, leading to judgments, wage garnishments and liens. In most cases, consumers could not obtain refunds if they cancelled their contracts, even if none of their debts were actually settled.

The new debt settlement law, crafted by the Treasurer’s Office in collaboration with Illinois Attorney General Lisa Madigan, prohibits companies from advising consumers to stop making payments to creditors, allows consumers to cancel a contract at any time and prohibits deceptive promises of specific debt reduction results.

It also requires the companies to provide written analysis of a consumer’s financial situation prior to entering into a contract as well as warnings on how a consumer’s credit may be negatively impacted by a debt settlement agreement.

In addition, the Illinois Department of Financial and Professional Regulation will be required to license debt settlement companies for the first time.

State Sen. Jacqueline Collins of Chicago, the Senate sponsor of the bill, said debt settlement companies could no longer be allowed to prey on consumers in crisis.

“This law will curtail the fraudulent, abusive and deceptive practices employed by many debt settlement companies that seek to enhance their bottom line at the expense of working families struggling with substantial personal debt,” Collins said.

State Rep. Karen Yarbrough of Broadview, who sponsored the bill in the House, said the law will provide important safeguards for consumers from dishonest debt settlement tactics.

“Consumers will now have the protections they need to make informed decisions about how best to resolve their debts as well as the tools they need to fight back against unscrupulous debt settlers,” Yarbrough said.

 Johnson Argues that Wealth Gap Compares to “Compelling National Interest Test” Which Could Justify Race-Recognition Remedies

Bethesda, MD (BlackNews.com) — In an address to Members of Congress and participants attending a Congressional Black Caucus meeting, Robert L. Johnson, founder and chairman of The RLJ Companies, called for a national discussion about the growing wealth gap which he referred to as a “wealth gap Tsunami threatening African American families”. He cited the recent Institute on Assets and Social Policy at Brandeis University study, among other studies, which conclude “the wealth gap between white and African American families has more than quadrupled over the course of a generation; the racial wealth gap increased by $75,000, from $20,000 to $95,000; and, at least 25 percent of African Americans have no assets.”

 According to the U.S. Census data, “white household median net worth is 10 times that of Black households. The median net worth for African Americans was $11,800 compared to $118,000 for whites.”

In response to addressing this compelling national crisis, Johnson stated that, “We must admit the harsh reality of a history of institutionalized racism and economic discrimination against African Americans is the primary cause of wealth disparity between Black and white Americans” and “we must be willing to talk about race recognition remedies at the highest levels of government as well as between Black and white Americans.”

Johnson suggests that the wealth disparity between African Americans and whites compares to the “compelling national interest test” cited in the Supreme Court’s Adarand decision where the Court ruled ‘a racial or ethnic classification must serve a compelling interest and must be narrowly tailored to serve that interest.’

In his remarks to the Caucus, Johnson listed several race recognition policy initiatives that could be discussed. For example, allow African American families earning less than $250,000 annually to defer all federal income taxes, without interest, provided tax savings are placed into a 401(k) type savings account which can only be drawn out at retirement or upon death at which time the government would be reimbursed for the deferred taxes. He pointed out that this would allow the gain on the 401(k) investment to be available to the families at retirement or passed on to future generations.

“I wish the answers to close the wealth gap were as politically palatable and acceptable as proposals to make our public schools better for minorities, to retrain minority workers for the new jobs market, and aggressively enforce laws against racial and economic discrimination. Over the years, this Nation has been committed to all of these objectives, but this effort will not close the Black wealth gap. I recognize that public policy based on race is extremely provocative and controversial but controversy should not prevent a reasonable dialogue about a societal dilemma that is real and economically devastating in its potential to millions of African Americans,” he concluded.

Johnson’s complete remarks can be found below and at www.rljcompanies.com

REMARKS BY ROBERT L. JOHNSON: A Wealth Gap Tsunami Confronts Black America

A wave of statistics predicts that a wealth gap Tsunami is threatening African American families. Consider these facts: “The wealth gap between white and African American families has more than quadrupled over the course of a generation; the racial wealth gap increased by $75,000, from $20,000 to $95,000; and, at least 25 percent of African Americans have no assets” according to the Institute on Assets and Social Policy at Brandeis University.

A study by United for a Fair Economy stated “for every dollar of white per-capita income, in 1968, African Americans had 55 cents and only 57 cents in 2001. At this pace, it would take African Americans 581 years to get the remaining 43 cents and achieve income parity with whites.”

According to U.S. Census data, white household median net worth is 10 times that of Black households. The median net worth for African Americans was $11,800 compared with $118,000 for whites. According to a 2007 Pew Charitable Trusts study, “nearly half of African Americans born to middle-income parents in the late 1960s plunged into poverty or near-poverty as adults” and “forty-five percent of black children whose parents were solidly middle class in 1968 – a stratum with a median income of $55,600 in inflation adjusted dollars – grew up to be among the lowest fifth of the nation’s earners, with a median family income of $23,100.”

These indisputable facts point out that middle income whites have far more wealth than even some high income African Americans. Equally disturbing, educational success achieved by many Blacks has not led to racial wealth equality. The current economic crisis that we confront will only serve to exacerbate and magnify the growing wealth disparity.

How do we address this compelling national crisis? First, we must admit that a history of institutionalized racial and economic discrimination against African Americans is the primary cause of wealth disparity between Black and white Americans.

Unless this harsh reality is addressed, the wealth gap will continue unabated and we will confront a society where many black Americans are the recipient of entitlements and white Americans are faced with making transfer payments to support the economic well being of these African American families.

I wish the answers to close the wealth gap were as politically palatable and acceptable as proposals to make our public schools better for minorities, to retrain minority workers for the new jobs market, and aggressively enforce laws against racial and economic discrimination. Over the years, this Nation has been committed to all of these objectives, but these efforts have not and will not close the Black wealth gap.

I suggest that if we are serious about closing the wealth gap we must first be willing to talk about race recognition remedies and this discussion must take place at the highest levels of government as well as between Black and white Americans. I recognize that public policy based on race is extremely provocative and controversial, but controversy should not prevent a reasonable dialogue about a societal dilemma that is real and economically devastating in its potential to millions of African Americans.

Therefore, to initiate this dialogue, I submit the growing wealth gap qualifies as a “compelling national interest” permitting the government to enact “narrowly tailored” policies based on race. In the Adarand case, the Supreme Court ruled “a racial or ethnic classification must serve a compelling interest and must be narrowly tailored to serve that interest.” In my opinion, the wealth gap between Black and white Americans meets that test.

Here are my public policy suggestions to address this compelling national problem and to get the conversation started.

The Federal Government should:

1. Allow black businesses to be eligible for government set aside contracts if they own 10 percent of a business rather than the existing 51 percent due to the 10-to-1 wealth gap between Blacks and whites — the African American owner must retain control of the board of directors and voting control. Significantly increase the dollar volume of set aside contracts for Black businesses at all government agencies.

2. Encourage majority-owned businesses to invest in black-owned companies by significantly reducing or deferring the taxes on the economic gain from those investments similar to the FCC “tax certificate policy” which motivated majority-owned media companies to sell properties to minorities.

3. Allow African American families earning less than $250,000 annually to defer federal income taxes, without interest, provided tax deferrals are placed into a 401(k) type savings account which can only be drawn out at retirement or upon death at which time the government would be reimbursed for the deferred taxes. The gain on the 401(k) investment would be available to the families at retirement or passed on to future generations.

4. Create a Treasury-backed fund to securitize short-term borrowing or emergency loans made by minority banks or other lending institutions to African American families provided these loans are marketed and made in a regulated and transparent manner. The securitized loans would encourage banks and lenders to make short-term or emergency borrowing available at reasonable rates and end payday lending as we know it today.

5. Require large banks under the Community Reinvestment Act (CRA) to fund a nationwide marketing campaign targeted to the African American community, particularly young adults that will focus on financial literacy and savings.

Many of these proposals are incorporated in some form or another in current policy and are usually based on economic disparities i.e. poor versus rich. This philosophy does not acknowledge the racial nexus of wealth disparity between Blacks and whites. With African Americans facing a wealth gap Tsunami, I believe the time to do that is now.

About The RLJ Companies
The RLJ Companies, founded by Robert L. Johnson, is an innovative business network that provides strategic investments in a diverse portfolio of companies. The RLJ Companies seeks to target undiscovered or underserved markets then exercise solid management to achieve results. Within The RLJ Companies portfolio, Johnson owns or holds majority interests in businesses operating in banking, private equity, hospitality, automobile dealerships, entertainment, and video lottery terminal (VLT) gaming. The RLJ Companies is headquartered in Bethesda, MD, with affiliate operations in Charlotte, NC; Orlando, FL; Little Rock, AR; Los Angeles, CA; San Juan, PR; and Monrovia, Liberia. Prior to founding The RLJ Companies, Johnson was founder and chairman of Black Entertainment Television (BET). For more information go to www.rljcompanies.com

 Residents in Western Cook County now eligible 

 Chicago, IL – Residents and business owners in Chicago’s Western Suburbs that were hit with severe storms and flooding over the weekend are eligible for low-interest disaster recovery loans, Illinois State Treasurer Alexi Giannoulias announced today.

 So far, twelve western suburban areas have been declared disaster areas by local officials after heavy storms on Saturday led to major flooding and caused property damage to many buildings and homes. The Treasurer’s Office expects more declarations this week. The local declarations make residents and business owners eligible for the Opportunity Illinois: Disaster Recover Loan Program.

 Under the loan programs, the Treasurer’s Office obtains below-market interest rates for storm victims in declared disaster areas who finance their disaster repairs through participating, local lenders. As of today, loan rates would be no more than 3.5 percent.

 “Our programs offer immediate relief to residents and business owners who are either underinsured or who need help making repairs before their insurance payments arrive,” Giannoulias said. “Access to a quick, affordable loan is often just what people need to recover from devastating property damage and to get their lives back on track.” 

The 11 western suburbs and one township include: Bellwood, Berwyn, Broadview, Cicero, Forest Park, Hillside, Main Township, Maywood, Melrose Park, Oak Park, Stone Park and Westchester. 

Residents, business owners and farmers that expect insurance to cover their damages can qualify for one-year bridge loans with interest-only payments. These loans are designed to be paid off in one lump sum when insurance or aid comes through. 

Underinsured residents, business owners and farmers can qualify for low-interest loans with repayment terms of up to five years. The underinsured storm victims must make payments on the interest and principal for loans exceeding one year. Also, loans with terms longer than two years require a compliance review. 

To participate in the Opportunity Illinois loan programs, borrowers must:

• Own damaged property in an area declared a local, state or federal disaster area
• Secure a loan up to their damage amount with a participating lender
• File the application within 90 days of the state or federal disaster declaration
• Use the money for disaster recovery

The Treasurer’s Office is currently enrolling local financial institutions in the programs, beginning with the 85 local financial institutions that are already approved to accept state depositories. They include Citizens Community Bank of Illinois in Berwyn, West Town Savings Bank in Cicero and First Suburban National Bank in Maywood. 

If you are a resident, business owner or banker who needs more information on Opportunity Illinois call the storm victim hotline at (866) 523-0641 or email opportunityillinois@treasurer.state.il.us.

Lost money, assets discovered during Cash Dash event

Illinois State Treasurer Alexi Giannoulias’ office wants to return more than $900 million in lost, forgotten and abandoned funds to Chicago-area residents.

A representative from Giannoulias’ office will conduct Cash Dash searches on the state’s online database from 7:30 a.m. to 5:30 p.m. Sunday, July 11 at Soldier Field in Chicago during the World Cup Festival. 

The Cash Dash program reunites Illinois residents with their lost or forgotten wealth, also known as “unclaimed property.” This wealth can be anything from long-lost bank accounts to entire estates that never made it to a rightful owner.

The Treasurer’s office is holding a total of $1.4 billion in unclaimed property for 10.2 million residents and businesses – with more than $900 million belonging to Cook County residents. The Cash Dash program aims to give it all back.

The World Cup Festival and screening of the final game is sponsored by the South African Consulate General in partnership with Ethnicity Soccer. For festival information, visit www.africachicago.com.

For more information or to conduct your own online search, visit www.treasurer.il.gov and follow the Cash Dash link.

Bentonville, AR (BlackNews.com) — Existing small business owners and entrepreneurs with hopes of starting up continue to seek access to capital in the form of bank loans, yet are still struggling to land credit. Only half of small businesses that tried to borrow last year got all or most of what they needed, according to a survey by the National Federation of Independent Business. In the mid-2000s, 90% of businesses said they got the loans they needed.

To help support small business and its business members, Sam’s Club has announced that it is testing an online program with Superior Financial Group, the Nation’s leading Small Business Administration (SBA) lender, which would make $5,000 to $25,000 loans available to its members who qualify. In a November 2009 state of small business survey conducted by Sam’s Club, nearly 15 percent of its business members reported being denied a loan to run their operation, up from 12 percent in April 2009.

The Sam’s Club small business loan pilot will focus on serving Main Street minority, women and Veteran owned small business owners as well as micro-entrepreneurs under the SBA’s Premier Outreach Express products such as Community Express, Patriot Express and Export Express loans.

Sam’s Club members who apply for a small business loan online during the pilot will receive a $100 off the application fee, a 20 percent discount and a 7.5 APR, which is 25 basis point discount. The terms of the loans will remain at 10 years, which is common to help keep monthly payments low. There is no penalty for early repayment. Business memberships cost $35 annually at Sam’s Club.

For more information or to apply, visit:
www.samsclub.com/sams/pagedetails/content.jsp?pageName=sbaLoanProgram

To learn more about business credit, visit:
www.BusinessCredit.org