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EDUCATION PLUS ACTION EQUALS CHANGE
Author: Ryan Mack, President of Optimum Capital Management, LLC
Published in Tavis Smiley's Covenant in Action
According to “Black Wealth, White Wealth”, by Melvin Oliver and Thomas Shapiro, the Black family’s median net worth is $8,300 compared with the White family’s median net worth of $56,000. Earl Graves Jr., of “Black Enterprise” magazine said, “Blacks on the average are six times more likely then whites to buy a Mercedes, and the average income of an African American who buys a Jaguar is about one-third less than that of a white purchaser of the luxury vehicle.” These are staggering statistics and have been the driving force behind my current profession.
It really began in 2002 when I attended a financial empowerment seminar and was moved by the number people discussing this issue. There wasn’t enough time to field the multitude of questions being fired towards the presenters. However, the next day, just before the stores were opening I walked past a shoe store and noticed a long line in front. I recognized one of the participants from the previous day’s financial empowerment seminar standing in line with her son. It was easy to remember her because she had asked many of the questions at the seminar, and in doing so, painted a very grim personal financial picture of her own circumstances. After re-introducing ourselves, I asked the purpose of the line and she shamefully responded, “They are releasing the new Jordan’s and I wanted to purchase them for my 7 year-old child.” I walked away knowing that the Black community was in need of more than simply education. Knowledge by itself is not power. Knowledge plus action equals power and it was time to take action.
My name is Ryan C. Mack, President of Optimum Capital Management. One of the reasons I launched my company was to address the economic problems within the Black community. I didn’t always know that I would take this route. My mother, Carol Mack, knew that I would eventually pursue a career in finance well before I did. When I was four she would give me a quarter. Six hours later, she would see her snotty nosed son running with a clinched fist. After asking what was in my fist, I would answer, “My qwoordah.” She realized long before I did that even as a child, I recognized the importance of fiscal responsibility.
In 1999 I graduated from the University of Michigan Business School with a concentration in Finance. During the next five years as a trader on Wall Street, I began to develop an interest in the significance of financial literacy within the African American community. I established my own financial awareness group in 2003, and began to write bi-weekly newsletters informing the members of important principles of financial literacy for people of all income levels.
Wanting to pursue a full-time career in financial planning, in 2004 I decided to interview for positions with financial planning firms only to discover the expectation that as an employee of these firms, I was to service solely high net worth individuals. This expectation was not in alignment with my own values and commitment to the community. Given the following information according to “Black Wealth, White Wealth”, by Melvin Oliver and Thomas Shapiro, I felt it would be socially irresponsible for me to ignore the commitment I felt to the Black community:
Armed with words of wisdom from my grandmother before I moved to New York from Detroit (“Don’t loose yourself when you go out there boy”) and with an enhanced spiritual connection with God, I was directed to create my own company.
For the next 12 months I created my own company by:
It is important here to note, that during my last three years on Wall Street, I volunteered weekly working with inner-city youth in the community. I established an organization entitled Leaders of Tomorrow (LOT) for students grades three through eight who were taught the values of leadership, unity, and commitment through stepping (a fraternity past time). Upon establishing my own company, the success of LOT resulted in my decision to establish another youth organization more aligned with the principles of my company.
I launched All About Business (AAB) in 2004. AAB is a group that is designed to increase financial awareness with high school students. Working with Benjamin Banneker Academy students in Brooklyn, New York, the students and I worked one day per week during the school year studying principles of financial literacy, current events, business etiquette, networking, and entrepreneurship. These students excelled with such a high level of proficiency, that I created an internship program within my company which allowed them to demonstrate their intellectual capital to the community. During this internship program the students:
AAB participants were successful in learning about financial literacy and listed below are many of the tangible results:
During the first few months of Optimum Capital Management, I initiated several other educational programs:
What is Optimum Capital Management? Optimum is a company established because the financial planning industry has long been neglecting the need for financial education in the community. As a company we instill principles of accountability and responsibility within a community plagued by high consumption and debt levels. Optimum Capital Management is committed to providing highly-skilled, full-service financial planning in the most cost efficient means for our clients. While we are a for-profit company with a significant clientele, we are committed to the needs of the community.
Optimum Capital Management recognizes the tasks to be accomplished. There are many factors that account for the economic and social status of African-Americans, some of which are not directly within our control to resolve. These issues must be addressed but not at the expense of neglecting the need for financial awareness within the community. How can we demand increased government funding for economic development when we are still spending 93% of our money outside our own communities? “The Black dollar turns over less then once on average before it leaves the community. Asians turn over their money nine times in their communities, and Whites turn their money over eight times before it leaves.” (Taking Care of Business – Lee Jenkins) How can we get upset at the government for the lack of support when we aren’t supporting ourselves? Sixty percent of America is spending more money than they are earning per month (The Millionaire Next Door). The fact is that consumption is within our control. Your FICO score, your debt levels, your consumption levels, and your insurance coverage are all within your control.
Consider too that the estimated loss to the 401K’s belonging to Enron employees was $1.2 billion. If Enron employees had received proper financial literacy education, they would have known about diversification and would have appropriately limited the amount of company stock held within their personal 401K plans. Many employees had as high as 80-90% of their retirement portfolio invested in Enron stock. With defined contribution plans becoming more of the norm (as opposed to defined benefit plans), employees are now burdened with the responsibility of planning for their own retirement.
Without the basic knowledge of how to control our finances, without being equipped or supplied with an ability to think for ourselves, we are not empowered and are at the mercy of others.
I have made a life commitment to God that I will do all that is necessary to assure that my community is not only educated of these empowering principles, but that they can use Optimum as a means to implement the proper solutions within their lives. A paradigm shift is needed to start this movement in our communities; our actions thus far have not been successful. Optimum will create the change that is necessary in our communities and beyond. This is my commitment and I will continue to do God’s work by any means necessary.