Empowering Economic Justice Through Financial Literacy

Audio Description

When Tanya Van Court’s 8-year-old daughter asked for a new bike and enough money to start an investment account for her 9th birthday, Tanya knew: “If I can get every child in Bed-Stuy and every child across America who looks like you to say that, I can change the world."  

Transcript

00:00 - 00:28

When I start out my Goalsetter presentation for kids, oftentimes I'm talking to a group of African American kids and I start by saying  [SPANISH], et cetera, et cetera. And the kids look at me like I'm crazy. And I say, look, how many of you speak Spanish? And not very many of them raise their hands. I say, But you would think I were crazy if I were going to deliver this whole presentation in a language that you didn't know.

00:28 - 00:54

But that's what America is doing to you every single day. America is expecting you and your parents and your grandparents and aunts and uncles to be able to navigate a world where you don't know the language, but knowing that language is critical to your ability to build wealth. And that's the language of money. This is Changing the Trajectory.

00:54 - 01:24

I'm your host, James Seth Thompson, Bernstein's Head of Diverse Market Strategy. Well, it's Financial Literacy Month. My guests today are leaders and change agents working to promote economic justice and empowerment. I'm joined by Karim Hill, executive director of the American College Center for Economic Empowerment and Equality. And also I'm joined by Tanya Van Court, founder and CEO of Goalsetter, a savings and gifting platform for young people. Look, there's a connective tissue here.

01:24 - 01:40

Both of you are committed to galvanizing people to achieve financial freedom, focus on education, and putting it into disparities that cost us personally and also cost the United States an estimated 16 trillion dollars in economic output since 2000.

01:40 - 02:02

So before we jump in to some very courageous conversations about financial literacy and investing, how about we just start with your own introductions and your own personal stories? Karim, I'll start with you. It's great to have you here. James, thank you very much. And so, so glad to be here. So I'll tell you a little bit about myself and how we got to this point. So I'll start from the beginning.

02:02 - 02:09

I was originally born in Columbus, Ohio. We moved to Houston, Texas, where I was raised. I was the fourth of five children.

02:09 - 02:38

And the biggest thing for me was sports, was the way I was going to get to college. So I played college football, was blessed enough to receive a Division 1 football scholarship to Ohio University. I went there and played football, did what every football player does, which is eventually got hurt and wasn't able to finish my career on the football field. So I did what every other human being has to do, which is get a degree and figure out what you are going to do with your life. So I graduated in the year 2000 what moved to Milwaukee, Wisconsin, to start my career in financial services.

02:38 - 02:46

I did not say I'm going to be a banker. That was not my plan. It was just get a job. Most African Americans at that time were getting into the banking world.

02:47 - 03:17

I was doing subprime mortgages and talking to people that look like me. They had issues like me. They didn't understand how to acquire a loan that was good for them. They didn't know what it was. I was kind of counseling them in that role, as a 22-year-old, did that for a year, got promoted to my first branch manager role in Madison, Wisconsin, ran that branch for four years, moved to Chicago, ran a branch there for two years, took over the district job in Milwaukee and eventually took over all of Chicago and Milwaukee, the Wells Fargo on the mortgage side. I had my first son in Chicago.

03:17 - 03:47

Then we moved down to Tampa, Florida, and I'm now running West Tampa for Bank of America and their retail branch network. Had my second son down there, relocated to San Francisco, ran all the East Bay for Bank of America on the retail bank and small business side, then moved to Manhattan with Capital One. Had my third son there, moved to Boston, Massachusetts, to run all the consumer business, the Citizens Bank in New England. Twenty billion dollars in assets I manage. And I did that for the first sixteen years of my life.

03:48 - 04:17

Left banking, got into the nonprofit space as the president and CEO of what's called the New England Business Association, did that for four and a half years, started a CDFI. We went out and raised five million dollars in capital for a CDFI that specifically targets Black entrepreneurs and women entrepreneurs. We raised five million, we deploy three and a half million of that in the first six months. And then I took over as executive director at the American College; so that is my career path and my career.

04:17 - 04:26

And again, James, I'm so glad to be here with you. Thanks. If there's one thing I took away from that, if you want to stop having kids, you got to stop moving. That's exactly right, that's exactly right.

04:27 - 04:35

So we're going to come back and talk about your role now. I really thank you for that. Tanya, how about you? James, I took something completely different away from Karim's story.

04:35 - 05:09

I'm waiting for the girl. So, I'm Tanya Van Court, CEO and founder of Goalsetter. I'll take you back to my beginning. Born in Oakland, California, mom was an elementary school teacher in the East Oakland Public Schools. I happened to be sixth of six. And in spite of the fact that my mom was a single mom of six kids, she brought home more kids on the weekends because she fundamentally believed in bridging gaps. So that's in my DNA. It's what I care deeply about. It's why I do what I do. I went to Stanford, got a couple degrees in engineering, worked at a lot of interesting places, doing a lot of interesting things, particularly rolling out new consumer technology products into the world.

05:09 - 05:38

So I was at ESPN, launched ESPN 3, which was the first digital video streaming player in the cable industry. Then I moved to Nickelodeon and ran nickjr.com and noggin.com and really cut my teeth on how do you create content that's engaging and exciting for kids, but at the same time, educational. And then I moved from Nickelodeon to Discovery Education, where I took that knowledge into classrooms and helped to deploy digital textbooks to classrooms across America to help kids with multimodal learning.

05:39 - 06:01

I actually decided to leave corporate America and start my own thing, not because I wanted to be an entrepreneur, quite frankly, I didn't, but because my own daughter was eight, about to turn nine. I now live across the country, in Bed Stuy, Brooklyn. And I came home one day and she said, Mommy, for my ninth birthday, I know exactly what I want. And I said, What's that? And she said, enough money to save for an investment account and a bike.

06:01 - 06:30

And I thought to myself, if I can get every child in Bed Stye and every child across America and every child who looks like you to say that, I can change the world. And so my journey to entrepreneurship was really a path for me to be able to change the world for kids of color, to be able to change the world for kids who look like my kid and give them an opportunity to experience financial freedom in the same way that so many other kids do.

06:30 - 06:54

Karim, I'm going to come back to you. And this is where we have a conversation about what the two of you do now. And we'll bring that together with respect to a financial literacy month. Karim, share with us a little bit about the American college, first and foremost, and then your amazing new role heading up the Center for Economic Empowerment. Absolutely. So the American college, first and foremost, a 90-plus year institution.

06:54 - 07:28

I think it's one of the only accredited financial services institutions in the United States, has a history of educating the financial service provider. That's really what the American College has done for 90 plus years. The Center for Economic Empowerment and Equality was the brainchild of the president and CEO of the College president, George Nichols. And it was his attempt to, for the first time, take the College from just dealing with the financial service providers to actually speak to the consumers of financial services to figure out what it is that they need and to most importantly, bring applied knowledge to those consumers.

07:28 - 07:55

And the word applied, James, is really the key. Because financial services companies are really good at coming out with content and coming out with knowledgeable pieces and coming up with products. But it's not always applied to the consumer. It's not something the consumer can take and use, and it's not something that helps the consumer better his or her life. And that's really what the intent of the Center is, is to be the applied knowledge center to the consumer for the financial services industry.

07:55 - 08:26

And obviously, this is a new role for you. So what excites you most about starting the Center and bringing forward the goals of the Center to the masses? What really attracted me to to the mission of the Center was the ability to finally create something that addresses the racial wealth gap. There's a lot of lip service and a lot of conversation that goes around that, but I never really felt like that gap was trully being addressed, and this Center is uniquely positioned to do that.

08:26 - 08:40

And here's why. It's an institution. We're not selling products. We're not doing anything, but we're here to provide knowledge. And we're also able to connect consumers to financial services in a way that they've never really been connected.

08:40 - 09:09

I'll tell you, James, what brought me to this space was after the George Floyd murder, my wife and I really started thinking about how can we play a part in bettering the society for Black people. We have three sons and we're thinking, how can we make this a better world, not just green... getting a bigger W-2, that helps them in the now, but how do we make this world a better place for them? We live in a place where people are coming to us for advice. White people are coming to us for advice asking what can they do.

09:09 - 09:35

And we started sharing our knowledge. And then when I learned about what President Nicholas and the Center were doing, I said, this is something I have to be a part of. So that's really what attracted me to this. Well, thanks to the [...] for all of the great work you do. Tanya, there are certainly some themes there that I think resonate with you, the inspiration your daughter has had in allowing you to kind of kickstart Goalsetter, so along the same lines of questioning,

09:35 - 10:10

Tell us a little bit more about Goalsetter. Why are you so excited about its role in society with respect to financial literacy? Yeah. So Goalsetter is a savings, smart spending, and financial literacy platform for kids. And soon we're also going to be launching investment accounts for kids and the whole family. Our approach to everything is significantly different than the approach of any other kids debit card in the market or kids banking product in the market. And it's significantly different for a number of reasons. Number one is, I don't come from the banking world.

10:10 - 10:38

I come from the world of kids and entertainment and education. And so those are part and parcel of who I am and what we bring to the table every single day with our product and our platform. We put kids first. We don't just say, hey, what's Ayckbourn's doing? What's STASH doing? And how can we kid-ify that? We say, hey, what's happening in the banking space? What's happening in the fintech space? How do we bring that to kids? But what's happening in the kids' space and how do we bring that into fintech?

10:38 - 11:06

And so that has created for us a product that is extraordinarily compelling, fun and engaging for kids. And I'll just give you one example, James. We have a set of financial literacy quizzes, they're mapped to national financial literacy standards, kindergarten all the way through 12th grade. So kids are learning real things. And that's the educator in me, right. I'm not going to just make up content that I think kids should know, we go to an educational body that is certified to do this and say, what should kids know at every grade level?

11:06 - 11:33

And so we make sure that our content complies with that. But the entertainment executive in me says that content has been boring for the past hundred years. No one has used it. When it is rolled out to kids, they say, Ms. Tanya, I fell asleep in my business class because what's being taught is not interesting or engaging. And so there has to be a way to do it differently. And so we found that way. So we take all of that content.

11:33 - 12:05

We put it into financial literacy quizzes. Kids get one quiz per week. But each one of those quizzes is rooted in names and GIFs from hip-hop artists and social media influencers and YouTube personalities and pop culture. And so it doesn't matter if their favorite artist is Jay-Z or Beyonce or their favorite artist is someone from Stranger Things. Right. They're going to see those people who they connect with and relate to brought into the financial literacy space and explaining key financial literacy concepts.

12:05 - 12:27

So when Beyonce says, can you pay my bills? Can you pay my telephone bills, we use that to explain, Beyonce wouldn't need anyone to pay her bills if she would just save for an emergency fund of three to six months of her expenses, she could pay for her own bills. Kids are really getting it. We have a young girl here in Brooklyn. Her name is Today. She's 12 years old. NBC News did a piece with her and they said, what do you love best about Goalstetter?

12:27 - 12:52

And her answer was, The thing that I love best is that Goalsetter teaches me things about money I never knew I was supposed to know. I thought money was all about saving some and spending some. But now I know it's about frugality and compound interest and the rule of 72. She went from the language of how you use money, which is all kids are typically taught in America, save, share, spend, save, share, spend. I don't know how many times I've heard that. Right.

12:52 - 13:15

That's how you use money. But she went from that language to the language of how you grow money and in fact, how you don't use money. I want to be frugal, so I'm not spending as much. But then I'm going to learn about compound interest and the rule of 72 so I know how to grow that money that I'm not spending. And that's what's fundamentally different about what we're doing. We're bringing culture. We're bringing gamification. We're bringing education.

13:16 - 13:45

We're bringing fun and we're bringing the background of a person who comes from Nickelodeon but also comes from Oakland into this platform. You know, we dug up a quote, Tanya, from medium.com, and you said, I grew up in East Oakland, California, in a working-class Black neighborhood. So, when you talk about closing the wealth gap in our country and galvanizing every African American kid and family to save and learn financial literacy, I am both deeply committed and uniquely qualified to lead this movement.

13:46 - 14:04

So taking a kind of introspective look at being a Black woman running a fintech company, how does that inform how you evolve your company to continue to address these challenges that all Americans face, but certainly those who are more disparate communities?

14:05 - 14:37

Yeah, look, it's a game changer. Being an African American woman sitting in this fintech spot. And I'll tell you, it's a game changer because the insights we bring are different. The products we create for our kids and our community are different, and the way that we speak to them is fundamentally different. And so, as I think about how this looks moving forward, this is a moment in time where America has an opportunity to fundamentally do a 180-degree turn.

14:37 - 14:55

For the past hundred years, we have claimed that we are financially educating folks in Detroit and Atlanta and Chicago with Community Reinvestment Act dollars that are coming out of every major bank and minor bank in this country that are pouring into these communities. But guess what? They're not seeing any output.

14:55 - 15:29

They're not seeing any change in outcome, and they're not seeing it because they don't have Black women at the helm saying this is how we educate our communities. This is how we engage our communities. And so to have the privilege and the opportunity to sit in this seat, I know that we can do things differently than how they've been done over the past hundred years and engage our kids deeply. And the reason I know that, James, is because we've seen it. So Robert Smith is extraordinary and he's one of our investors. But he's also just an extraordinary mentor for us. But he's an extraordinary mentor for so many people.

15:29 - 16:02

He has an event that he calls the Restoration Retreat where he gets together 50 of the most vulnerable kids in the country for this weekend-long restoration event that includes things like yoga and a self-esteem workshop and fly fishing and a financial literacy workshop. And so he had me do a workshop on building wealth for these 50 all Black kids from across the country. And when I did this workshop, I put together a specific course called Building Wealth, a four-part mini series inspired by Jay-Z.

16:03 - 16:14

And it was two hours. I talked to these kids who are most vulnerable about building wealth for two hours. And at the end of the two hours, they flocked to me and said, Ms. Tanya, you just changed my life.

16:15 - 16:45

That's what this means. James, we had the opportunity for the goalsetters of the world and the Tanyas of the world and our team that is behind this platform to change the lives of so many kids who have never had someone like me stand in front of them and explain what it means to build wealth and how they do. Absolutely. Karim, this reminds me of the conversation we had when we were just kind of getting to know each other's backgrounds and the passions that really fuel the things we do. You spent some time in this industry.

16:45 - 16:59

You have a great opportunity to lead this center. But what we do know, whether it's financial literacy, whether it's investing, whether it's savings, is that there is an experience and exposure and an education gap.

16:59 - 17:26

Right. And, you know, I won't say it's only with Black America because it's not, right. But however you define disparate communities, it's a challenge. How are you thinking about being a resource to these underserved communities to drive the education necessary to move from saving to investing and hopefully to wealth management and feel free to leverage any specific programs that you guys are thinking about launching or have launched?

17:26 - 17:59

So that's a great question, James, that you for posing it. And so there's a couple of ways we're doing it. The first thing we're doing is we're launching a set of research and this research is around trust. And let me tell you how we got to this point. So it's clear that every financial services company wants to do a lot of business with all types of groups, whether it be Black, Latinx, Native Americans. They want to do business with them. The way they go about it tends to be what. They tend to go about it from a reactionary standpoint, let me create a product. And if we create a product, we'll get that group to come and use it.

17:59 - 18:30

And we look at it as an institution, as a college, and we say the reason those groups do not take your products or utilize your services are because they don't trust you. And the only way to stop this cycle is to understand who they trust and why they tust. We're launching this research pilot around trust and we're targeting Blacks first and we're going to even target a more subset group of that which is Black women. We want to understand who do Black women trust when it comes to getting their financial services advice.

18:30 - 19:00

And James, we don't care if the answer is our faith based organization, my aunt, my uncle, my barber, my beautician, we don't care. We just want to know who it is and the most important piece we want to know why. Why do you trust them? And we're doing this research on a two-pronged approach. One, we're going to hire a research firm to do it so we can get a great baseline. But two, we're hiring three or four Black PhDs and we're going to do the research in a very culturally significant way.

19:01 - 19:21

Second, we're going to create this career pathway that takes a young Black student, whether it be at HBCU or community colleges across this country. We're going to put them through a financial literacy certificate program. Inside that program, they will have enough baseline core curriculum to acquire designation.

19:21 - 19:53

Once they acquire that designation, they then will be partnered up with a financial services firm to then look at internships and externships and things of that nature. So they can get into the industry. That's really what we're looking to do. We want to make sure that there is a true pipeline for young Blacks in colleges, whether they'd be HBCUs or community colleges, and how we can pull them through this pipeline and entering the financial services industry. So those are two programs we're putting together that we're uniquely qualified to do, and we are confident it will change the landscape of the financial services industry.

19:54 - 19:56

So there's one more thing that that really caught my eye.

19:56 - 20:31

And it really ties to a number of conversations we've had on the show. Talk to us a little bit about the programming and the core principles of Four Steps Forward. I'm glad you asked that. So when we started this center, it was around this core principle of four steps forward. And the four steps are simply these. The first one is to develop financial literacy programs for Black women that are uniquely designed to address the systemic wealth inequities that have happened in this country. So that's the first principle of four steps forward. The second is to create a collective impact initiative that can be executed at the community level.

20:32 - 20:33

That's critical.

20:33 - 21:01

The third is identifying to develop the next generation of Black leaders inside financial services firms and that's that pipeline we just talked about. And the fourth is to commit to purposeful professional development in the form of recruiting and retaining Black financial services professionals. The last one is critical to that because having been a Black financial services executive, I realize the higher you move up, the more rare the areas and the less people look like you around.

21:01 - 21:19

And there are trap doors inside that as you keep climbing. And we want at the college to be an informational system for those Blacks so that we can provide them real, culturally relevant information about how to navigate financial services, because it's one thing to get us in the door.

21:19 - 21:47

It's a whole other thing to have us succeed while we're there and watch us grow inside the company. And I think that's where we are uniquely positioned to bring. So that's what the four steps forward program is going to identify and work on in the upcoming years. You know, it's interesting. I think all of the listeners know as a senior leader here at Bernstein, we meet the needs of high-net-worth individuals. Right. There's no, there's no denying that. And I always say more money, more problems. Right.

21:47 - 22:21

As you begin to save, you begin to invest. And once you begin to invest, you kind of think about different strategies to create legacies and things like that. But myself and a colleague of mine, Richard Murray, we did an article in Business Insider just to really talk about the importance of financial literacy and planning. Right. Whether it's five thousand, 50 thousand or 50 million, the principles are all the same. It's just that the complexities change as life's liquidity events hit you upside your head for lack of a better term there.

22:22 - 22:24

And I'll turn to you, Tanya, for a bit here.

22:24 - 22:57

When you think about your own financial lifecycle, how does your experience kind of mirror what you're building? How does your experience also influence the outcome of people in Goalsetter and the goals you have for kids and dismantling these inequities that we see? You know, when I start out my Goalsetter presentation for kids, oftentimes I'm talking to a group of African American kids, and I start saying [SPANISH].

22:58 - 23:10

And the kids look at me like I'm crazy. And I say, look how many of you speak Spanish? And not very many of them raise their hands.

23:11 - 23:45

I say, But you would think I were crazy if I were going to deliver this whole presentation in a language that you didn't know. But that's what America is doing to you every single day. America is expecting you and your parents and your grandparents and aunts and uncles to be able to navigate a world where you don't know the language, but knowing that language is critical to your ability to build wealth. And that's the language of money. And so part of what we try to debunk upfront is that just because you don't know about personal finance, it does not

23:45 - 24:17

mean that you're not smart. I went to Stanford, I got two degrees in industrial engineering. At the time I was in my late twenties, I was working in Silicon Valley. I had a million dollars in stock and stock options from the company that I was working at, and I had no idea what diversification or asset allocation meant. And guess what? When the 2001 bubble burst, I lost all of it overnight because I had no idea that when that stock vested, I should have immediately been selling that stock and diversifying, putting it in a mutual fund, buying

24:17 - 24:39

some others up, getting out of tech and not having everything concentrated in tech, those were foreign concepts to me. And so my experience is the experience of a person who says, hey, I'm really smart and good at my domain and that's enough. I don't have to know about this other domain or no one taught me about this other domain.

24:39 - 24:58

Right. It's the experience of a person who feels dumb and shamed because you don't know this other language that America never taught you, in spite of the fact that you went to one of the best universities in the country and got two engineering degrees that are related to finance tangentially. Right.

24:59 - 25:30

I mean, so what we are trying to do is debunk all of that. So you don't have to feel shame, mom, dad, that you don't know how to teach your kids about personal finance because you never learned. We're going to help you and we're going to stand in that gap for you. Kids, you don't have to feel like, hey, I'm really good at math and I'm really good at science, but I really don't know anything about money. And so that means that you're dumb or there's some sort of a stigma there. You don't have to feel that stigma because we're going to teach you.

25:31 - 25:41

So this is all about how do we teach folks who have never been taught before? And by the way, when they have been taught, they've been taught in a way that, quite frankly, isn't engaging for anyone.

25:41 - 26:09

And that's why you have the majority of Americans right now who are financially illiterate because we just haven't done a good job as America. We've done an even worse job with people of color and with those who need it most. And I think with the work that both of you are doing, it's the intentional approach that matters. Look, at the end of the day, we don't know what we don't know. A lot of wealth creators that look like the three of us are first generation wealth creators. They have the resources or the assets.

26:10 - 26:29

But that still doesn't make up for the experience, the exposure and the education gap. So this is why I was really excited that both of you came our way through some very important introductions, because I think what you both are doing in your own respective worlds really helps close that gap.

26:29 - 26:59

We have historically been underserved, underengaged, under-resourced, and the gap is still there. So I just want to say I really appreciate that. Karim, one of the things that's pretty apparent through the center is that you're advocating for people to invest in underserved communities and to look at that investment as an investment. How can doing this be a sustainable solution in your mind with respect to closing that wealth gap and literally changing the trajectory of the course of history for underserved communities?

27:00 - 27:04

Yeah, so I think, James, there's two real components of this.

27:04 - 27:38

One, the financial services industry has to change its vantage point in its view of financial literacy. I think the financial services industry should see financial literacy as a form of impact investing, just like everyone sees climate change, they see green energy, they see affordable housing as impact investing. We need to have the same approach when it comes to financial literacy. Right. That is the core building block of everything we need when it comes to people of color in this country changing their trajectory.

27:38 - 28:02

I'm talking about banks, insurance companies, asset managers, broker dealers. The entire spectrum has to change its viewpoint of financial literacy. If they look at it from the lens of impact investing, then this thing has legs. The second thing I would say is this. We have to think about financial literacy for the entire spectrum. When I mean spectrum, I mean it in two different ways. I mean all people of color.

28:02 - 28:19

We're focusing on Blacks right now at the college, but we're also then going to go on to Latinx communities. We're going to go into the native communities. We're going to go on to LGBTQ. We're going to go to all the spectrum of people for the second piece is educating multi-age people around financial literacy.

28:19 - 28:44

What tends to happen now in the financial services industry? I used to sit on the board of [...]. It's a great organization. They're educating the youth when it comes to financial literacy, but it kind of stops what you get into college. To me, that's a fallacy because I didn't make any money until I got out of college. Right. So why do we stop there? And we need to make sure we're educating people from 25 to 55 around financial literacy.

28:45 - 28:55

This can help change the trajectory of the population that's today, most importantly, their future generation. This is why there's an element of pay it forward.

28:55 - 29:29

And the things I teach my kids today as preteens will be quite different as they get older, when they start thinking about families and career. And I think, to your point, Karim, as an industry, I don't know if a lot of wealth managers are having conversations about financial literacy, having a lot of conversations about here, the products and services I can offer you. But I feel there's a responsibility to start everyone off on the right foot. And just as more money creates more complexity, so should we refine how we provide advice

29:29 - 29:36

as youth are evolving into teens and teens into young professionals and young professionals into mature professionals.

29:36 - 30:11

Tanya, I know Goalsetter is really focused on really getting kids to be more excited about saving. You touched a little bit earlier about the investing piece, what is some of your vision about that transfer of knowledge and transposing the work you do into more investing in things they can grasp, hold to as they get older. Yeah, so there is a really interesting aha moment that we had with Goalsetter. And when we launched, we were all about all age kids. All the venture capitalists said, well, what age are you targeting? And we said, we're targeting every age kid.

30:11 - 30:25

I happen to have a 15 year old and 11 year old, a 10 year old, and a five year old in my own home. I don't want one platform that's a teen and tween debit card for my kids over 13. But if I got an 11 year old, they can't be on that platform for they are on something else. And then I got something else for the five year old.

30:25 - 30:56

So we already had that insight. But then what we saw was there was a woman in California in particular, and her name was Emma. And Emma, I knew, only had one kid. She had a daughter. But when I looked at Emma's Goalsetter profile, she had three kids on her profile. And so I called her up and I was like, Emma, I'm completely confused. What do these three kids come from? Well, Emma said, well, I love Goalsetter so much to use it to save for my daughter that I want to use it to save for my own goals as well, I added myself and my husband as kids on our profile because there was no other way to do this. And so that was the big aha moment.

30:57 - 31:06

You know, what parents really wanted was something that they could do all together as a family. And it wasn't just saving. On the financial education side,

31:06 - 31:41

we would get the same kinds of things happening where parents were taking their kids' quiz and then the quiz was used up for that week. And the kid is like, what are you doing? You used up the quiz this week! Because they want it to be engaged in that way as well. So we really believe that by bringing in the kids, we are bringing along the parents. And as you talk about investments, we think that investment is a tremendous part of that too. Think about how many households in this country where the kids are the ones who are teaching their parents about the technology.

31:41 - 31:58

Right. We believe that money is no different. There are some kids out there who are so savvy about stocks and options and GameStop and investments. Right. They are doing the research. They are hungry to learn. And we believe that they can bring their parents along.

31:58 - 32:30

And so our investment tool, yes, is going to let kids begin to invest early. But it will also let a couple of other things happen, number one, it will let parents invest alongside their kids. And for people to invest as a whole family. It will let family members and friends to be able to gift stock and gift investment vehicles rather than just gifting gift cards that just encourage our kids to spend more money and be the next generation of consumers. We have an opportunity to help them become the next generation of savers and investors.

32:30 - 32:44

For Financial Literacy Month, we are launching a campaign in conjunction with the NFL Players Association called Dropping Jewels. And so NFL players are Zoom-bombing into classrooms across the country and dropping key financial literacy knowledge into these classrooms.

32:44 - 33:09

So, hey, back in 1980, you could have bought a pair of Nike sneakers for thirty dollars, or you could have spent that thirty dollars on a share of Nike stock. If you spent the thirty dollars on Nike stock, how much would you have now? 18,100 or 1.8 million. You kids would have 1.8 million dollars. And that's why the next time you ask your mom to buy you a pair of Nike shoes, make sure you also ask her to buy you a share of Nike stock. That's good stuff.

33:09 - 33:38

And you know, the final thing that I just want to point out in terms of this passing along of generational knowledge and therefore passing along generational wealth, those two are inextricably linked. When you look at wealthy families even, 90 percent of wealthy families are losing their wealth by the third generation. So they're passing along the wealth, but they forget to pass along the knowledge or they don't have a great tool to pass along the knowledge. And that wealth is being squandered.

33:39 - 33:54

70 percent of middle class African American families are projected to have a child that falls out of the middle class. So even in those instances where we have made gains, we are positioned to take 10 steps backwards instead of 10 steps forward.

33:55 - 34:13

If we don't help teach our kids about how to build wealth, how to value a dollar, what to do once they get a little bit of money, how do they take that little bit of money and make it grow and turn it into a lot of money? And so that's what we're focused on. This is not just a platform for those who don't have.

34:13 - 34:41

This is a platform for everyone who understands that in order to continue to have and to have generationally, we need to not only build up our bank account and build up our investments and have some generational wealth to pass along. We need to have generational knowledge to pass along as well. I love it. I like this idea of a family that saves and invest together, thrives together, and also that generational transfer of information and assets.

34:41 - 35:02

But also education is a two-way street. A lot of times, our clients who are the wealth creators are the generation 2s and 3s, and they are kind of selling up the education to the generations before them. And obviously there are generations 1s and 2s that need to educate generations 3 and 4.

35:02 - 35:34

And for our family, engagement is such an important piece. We're talking about families who are at the other end of the wealth spectrum. But again, the opportunity is the same, right, that transfer of education and knowledge, putting a family plan together, recognizing what the goals of the plans are and what transfers to the generations in addition to the dollars. I think that's how we create a more sustainable family legacy through the lens of investing and wealth management.

35:34 - 35:59

I want to conclude by giving you both an opportunity to just, what's your key takeaway or ask, and Karim, I'll start with you. Yeah. So, James, first of, thank you for this platform. This is something you do not have to do. But I can tell you choose to do it because of who you are. So first, thank you for this platform and for having us on it. To me, the key ask is this. It kind of goes back to my last answer.

35:59 - 36:34

I want the financial services industry to look at this and to look at financial literacy as an impact investing. Stop looking at it as charity, stop looking at it as philanthropy and put the same lens that they put on new product development, new market expansion and everything else they do in their business model. Use financial literacy with that type of passion and that type of energy. If that is done, it has been proven that we will succeed. Right. This country was founded on the labor of people of color and the financial services industry backing it with money.

36:34 - 36:47

We can continue to move forward. If the industry is 100 percent behind it and they see it as an impact investing. That is my hope, is that they will change the lens on how they view financial literacy. Thank you, man. Tanya?

36:47 - 37:11

I love what Karim said and I really want to build upon that and say, my ask is that we do things dramatically differently. We have spent the last hundred years having the same people trying to educate communities of color, people who don't necessarily understand what the problems are.

37:11 - 37:35

People don't who don't necessarily understand the right solutions and people who don't necessarily understand the right approaches or language or connection points, all of those things that are essential to creating a solution that works and will be impactful for the next fifty, a hundred, two hundred and fifty years.

37:35 - 37:56

And so you've got to stop pouring money into the same places that you've been pouring money that are not working. And you have to start investing, to Karim's good point, investing in solutions that are brought to you by Black and brown founders and entrepreneurs and nonprofit executive directors.

37:57 - 38:17

You have to start investing in those organizations because those organizations know the solutions and how to reach and change the lives of the people who you suggest you are trying to reach. So if you're really trying to reach them, then you've got to do something different because the past hundred years of strategies just have not worked.

38:17 - 38:47

I couldn't end on a better note. Again, I really appreciate the work you both are doing and I hope there's a larger collaboration that will start among the three of us. We're all in three different lanes, but we all have the same goals, we're driven by the same passions, and we can be some trendsetters just to make sure that we are leading the charge in addressing the things we know need to be addressed, but also creating wealth. You know, sometimes that's just awkward.

38:47 - 39:10

There's an end goal here and the end goal is to create a legacy that you could be proud of and transfer not just the cash, but the knowledge, the information, and the insight. And the best thing we can do is to leverage our platform, leverage our voices, leverage our experiences, but leverage our passion for those who need to benefit from this information the most.

39:10 - 39:15

So, again, thank you both for joining me on this episode. Thank you so much for having us, James.

39:21 - 39:49

Hope you enjoyed today's episode. We love to hear from you. So please e-mail your thoughts, questions, and feedback to diverse markets@Bernstein.com. Please be sure to share, subscribe, and rate us on Apple Podcasts or anywhere you listen to podcasts. And again, check us out on Twitter at BernsteinPWM. Bernstein: Making money meaningful for individuals, families, and foundations for over 50 years. Visit us at Bernstein.com.

Host
James Thompson
SVP—Head of Diverse Markets Strategy

The information presented and opinions expressed are solely the views of the podcast host commentator and their guest speaker(s). AllianceBernstein L.P. or its affiliates makes no representations or warranties concerning the accuracy of any data. There is no guarantee that any projection, forecast or opinion in this material will be realized. Past performance does not guarantee future results. The views expressed here may change at any time after the date of this podcast. This podcast is for informational purposes only and does not constitute investment advice. AllianceBernstein L.P. does not provide tax, legal or accounting advice. It does not take an investor’s personal investment objectives or financial situation into account; investors should discuss their individual circumstances with appropriate professionals before making any decisions. This information should not be construed as sales or marketing material or an offer or solicitation for the purchase or sale of any financial instrument, product or service sponsored by AllianceBernstein or its affiliates.

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