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CHAPTER 1

RULE 1We Live in a Free-Enterprise System — Embrace It

Money runs the world from the moment you wake up until the moment you hit your pillow and head to sleep. Actually, money is even intersecting every aspect of your life while you sleep!

I am talking about YOUR life, not some random person you don't know and cannot relate to. I am not talking about a city's economics, or a company's balance sheet or revenue, or a country's identity, brand, or GDP. I am talking about YOU.

So, you doubt me? Okay, that's understandable. Check this out:

You woke up this morning at 6 a.m., 7 a.m., 8 a.m., or whatever. What precisely woke you up? An alarm clock, or an alarm setting on your mobile phone or smartphone? That's money, folks. (It's actually more than that. It's entrepreneurship, which I address in Rule 4 in the book.) You or someone who loves you spent hard-fought-for cash money for that alarm clock or phone. No one got it for free.

You pulled back the sheets someone purchased and rolled out of the bed that someone purchased and put your feet on the ground of a house or an apartment that someone is paying for (even in most public housing the tenants pay a portion of the rent out of their own pockets).

You put on the slippers you or someone paid for, and walked into your bathroom to brush your teeth — with toothpaste and a toothbrush that someone paid for.

You washed up with soap and dried yourself with towels that someone paid for.

You then walked to the refrigerator that someone bought, and nourished yourself with food that someone purchased, probably that same week.

As you walked out the door, you turned off the lights and other utilities that you or someone else is paying the bill for.

You plopped yourself into a car that you pay for, probably on a monthly basis.

You started the car up, and within fifteen minutes you glanced at the gas gauge. If it was low, you pulled into a gas station, and you paid for that gas in real time.

You dropped your children off at day care on the way to work, and while the ladies there are super nice and kind, for sure they are not keeping your crazed-with-energy kids just for the hell of it. You are paying these hardworking people to put up with them. (Smile. I am sure your kids are just angels.)

Late for work after dropping your kids off at day care, you got pulled over for driving too fast on the street, or maybe you got a ticket on the freeway for driving in the carpool lane because it was only you and the blow-up dummy in the car that morning.

The police officer, who could not have been more polite in this instance, did not want an excuse. He did not want an apology. He did not want to hear your sob story or promises for redemption. He wanted your money for your city's coffers, and so he wrote you a ticket. And you didn't get mad, you just paid it — unless of course the radar was lying (smile).

You stressed yourself out to get to work before starting time — let's say 8:30 a.m. — not because you absolutely love punctuality but because you value your job. A job that hopefully you love, or at least enjoy and find fulfilling, but let's face it: It is a job that provides you with a paycheck. You are getting paid to be there, which is at least part of the reason you are there.

And even if you did love your job and would be willing to do it for free if you could afford to do so, you probably wouldn't break your hypothetical neck to get there before 8:30 every morning.

Given a choice and complete economic freedom, you would probably stroll in at whatever time you liked to that job. And this is precisely why my lovely retired mother, who worked hard her entire life to raise her children, build her own nest egg, and take care of her responsibilities, now has a business card that lists her full name — and nothing else.

My mother has no interest whatsoever in being reached by anyone whom she does not fancy now that she can afford to fancy whomever she chooses. Money got my mother to work on time every day for thirty-plus years, and money allows my mother to get up at any time she likes now. She has an 850 credit score, by the way.

So, your being there at work on time every morning (at least I hope this is the case) is all about money. Your money! And there's also this: someone values you enough to pay you to be there.

Is the light bulb going on yet for you?

As my best friend, Rod McGrew, once told me, "Even the parking meter that you stopped your car in front of on your way home to pick up some food for dinner has figured out capitalism."

All it does is sit there every day, collecting consistent and impressive passive income from you and everyone else who wants to sit before it on an hourly basis. Every day.

And don't get mad at the parking meter, either. The income it generates allows the city you live in to collect enough money to pay for public services for you and your city.

Take my friend, St. Louis Treasurer Tishaura Jones, who used parking meter fee income to fund financial education for the residents of her city. She even partnered with Operation HOPE and five local banks in town (that benefit from city deposits in their bank vaults) to form and launch the first-ever HOPE Inside location at St. Louis City Hall, where it proudly operates to this very day. All of this was done at no direct cost to city residents, thanks to Tishaura's brilliant thinking. (And by the way, the financial literacy, homeownership, small business, and entrepreneurship classes are all FULL. I just love this, and you should too.)

And now back to an average day in the life of YOU: You head home after grabbing dinner, which was also paid for with someone's cash, and you and the family sit down at the dinner table, using plates, utensils, even napkins and paper towels that you or someone who loves you paid for. After dinner, maybe you sit down to watch the big-screen television that someone definitely paid for.

And so on, and so on, and so on.

This routine continues until you go to bed with the things and services that occupy every aspect and moment of your life involving money. Even when you are sound asleep, (your) money is at work.

And then, like magic, the entire routine begins again. When you wake up six to eight hours later, it all repeats itself. Just like Groundhog Day.

But most of us never notice any of this. We go through the motions, never noticing the elephant in the living room of our lives. Money.

But where did all of this start? We were born brilliant, correct? So how did we take a turn so wrong — not only down the wrong street but on the wrong expressway, heading in the wrong direction, to the wrong city.

The answer is: we never got the Memo.

Here I Go Again: Why I Love Credit Scores

If you never got the Memo and are a card-carrying member of the Invisible Class, I can predict some basic things about your economic situation. First, your personal finances aren't together — maybe a few of the bills on your kitchen table have red "past due" stamps on them. More importantly, you don't know (or want to know) your credit score. Second, your family finances probably aren't overflowing with hope. You don't own, you rent, and you're not putting away money for your kids' educations. And, in all likelihood, your business plans are nonexistent. You don't see yourself ever running a business, and you couldn't get a business loan even if you'd just invented the best thing since the Ginsu knife.

In short, you are going in the wrong direction down at least one of the three basic paths to financial independence.

Let's start at the beginning. The beginnings of financial literacy come from understanding how our purchases and debts contribute to an invisible (for the Invisible Class) number that determines our economic destiny: the credit score.

A large and growing portion of employers (more than 40 percent at the time of this writing) require a credit check before they will hire you. That means that no matter how smart or qualified you may be — or how brilliant your now-college-educated-child may in fact be — if your or their credit reports stink, you can pretty much forget about getting hired.

But there is hope. This is a challenge that you can do something about. Take one of our clients at HOPE Inside Ebenezer (Dr. Martin Luther King Jr.'s home church in Atlanta), Ms. Eboni Brown.

Here is Eboni's story in her own words:

I applied to participate in the 700 Credit Score Community after having been denied my dream job. The reason behind that denial was my credit score. It was too low, and I had too many items in collection.

Doubtful that I would get accepted (because my score was so far from 700), I was overwhelmed with joy and so excited when I received the email saying that I had been accepted into the program. This was the opportunity I needed to receive guidance and motivation as well as a game plan to get my overwhelming debt and falling credit score under control.

After attending the first session, I was elated to see that I was not the only person having debt issues, and that I would be in a cohort of like-minded individuals ready to get their finances in order.

During my tenure in the 700 Credit Score Community, I learned several things. The first, and I believe most important, was that you can't change your credit score overnight. It takes time and patience and the practice of one day at a time.

I learned also to evaluate my lifestyle. I needed to determine the root of the problem. Was I living a caviar and champagne life with a Wendy's and Coca-Cola budget? Was it the mistakes I made in my young adult life that were now catching up to me? Did I just not make enough money?

In all honesty, it was a combination of all of the above.

So, based on the principles I learned in the class, I began to budget my money and live within my means. I put aside the thought that I would never become debt-free and have a great score and filled my mind with more positive thoughts.

After adjusting to my new lifestyle and mind-set, I was very anxious to report to my coach all the things that I had put into place and to receive her feedback. During that session, I learned that the work I had done within a three-month time frame had increased my score 52 points. To date, I have increased my score 78 points.

I continue to apply the concepts I learned from the program, and I look forward to learning more. I am excited to cross the finish line and attain a 700-plus credit score. All things are possible!

A credit check is not necessarily a character check, but it amounts to the same thing in this world we live in today. Eboni chose not to argue with reality but rather to change it. She decided to win.

If you want to start a new business or buy a home, the financing you seek will most likely pivot heavily off your personal credit history. I know this firsthand.

As an entrepreneur with 1,001 ideas coming up in my teenage years, I used to have credit that stunk. I'm talking 500-credit-score range. When I was eighteen years old, I was homeless for six months in Los Angeles, California. Things got so bad and the stress and the harassing calls from creditors so intense that I even considered filing for personal bankruptcy. I'm glad I didn't, but nothing was easy during this period.

I remember signing an auto finance contract to pay more than 18 percent interest to buy a car during that period. I pay 1.99 percent for a car loan today.

I signed up for a time bomb — I mean, a new credit card — that charged me 23 percent interest annually. Of course, it was marketed to me as "free money," and made total sense in my head. Until I had to pay it all back.

I could have easily filed for bankruptcy, and I don't judge others who believe they must, but I knew that I had gotten myself into this mess and I needed to take responsibility and get myself out of it.

No one forced me to take on all those loans or to sign those contracts (which I did not read, even though I was encouraged to). I did that. I didn't need help screwing up my financial life. I did a brilliant job of that all by myself.

My mentor, former UN Ambassador Andrew Young, says that "men fail for three reasons: arrogance, pride, and greed." I wasn't full of greed, but I was guilty of being full of pride. Pride kills. I needed to get over it — and get over myself.

On a related note, African Americans are the celebrated and targeted kings and queens of spending needless money, racking up more than $1 trillion in annual payouts, with almost nothing tangible to show for it.

Air Jordan tennis shoes and jeweled cell phone cases don't count. Cars don't count either — as they start depreciating the moment they drive off the lot.

In short, we don't own a THING.

It always kills me when professional athletes take out $4 million in loans to buy stuff, and then when their lives fall apart and they can't pay, now the bank is "racist" and "oppressing" them. Huh? What?

We weren't saying any of this stuff about being oppressed when we were all set to take out these ridiculous loans and credit agreements. And, no doubt, there would have been huge claims of bias and discrimination if we were denied the loans in question in the first place.

No, nine times out of ten, there is no funny business going on. We just got hoodwinked. Robbed in broad daylight. And now we're mad.

Well, while we are busy being mad and throwing up the Black Power sign or whatever, the lender just wants their money back. And unless we can prove fraud or misrepresentation, we just need to pay them. Or just say that we can't. That simple.

Losing at the roulette tables in Las Vegas does not rise to the occasion of a Dr. King writing the "Letter from a Birmingham Jail." No need to call the NAACP. They have better things to do than to waste time with someone on stupid stuff. We just need to deal with our drama. I dealt with mine.

I knew that my name was all that I had. It was my principal and primary asset. I had to protect my good name even if it hurt my pocket and my pride in the short term. I knew that my name (and my financial record) would be my signature and my calling card for the rest of my life, and I had dreams to achieve. It was time to get busy.

My credit score was once just above 500 (really bad, by the way). My credit score today is around 750. The quality of my life changed significantly when I got it above 660. Everything changed. My self-esteem, my self-confidence, and my sense of well-being, it all changed. My options expanded, and my dream making got easier.

To my personal surprise, my decision making also got better.

Like almost all important things in life, this was really about my own growth. This growth was simply reflected in the state of my personal credit profile and credit score. Likewise, within my own community, I believe that when our well-known reputation of our Black Consumerism is replaced by a sustained legacy of Black Wealth Accumulation — starting with raising our credit scores — we will not only see a community that has choices, a high degree of well-being, family stability, and increasing self-esteem, we will see a race that has begun to turn itself around.

Changing one's credit score isn't some game tied to "the man" trying to keep you down or "the system" oppressing you. The system didn't buy that now-broken-down television set on torn-up credit from the rent-to-own store. Knowing this is a part of getting the Memo.

Boom.

Operation HOPE Gets in the Credit-Score Game

Several years ago, Lance Triggs, one of my chief lieutenants in our silver rights movement and a dear friend who also runs a division of Operation HOPE, began experimenting with positively impacting credit scores for our adult clients. The results were stunning (to us) and liberating (to them). (Silver rights is about empowerment: How we transition beyond giving a fish and teaching how to fish to owning the boat — and the pond — itself. It is about making more money but also about making smarter financial decisions with the money we have.)

Lance and his group at Operation HOPE had consistently moved credit scores up an average of 120 points for our clients over a twenty-four-month period. The interesting thing is that in the process of raising their credit scores, they (unknowingly) accomplished so much more for the clients:

* Financial literacy and financial IQ improved.

* Confidence, personal well-being, and even self-esteem improved.

* Clients' options expanded and deepened, and their decision making became radically different. Even choices about who they wanted to be with as mates changed!

* They stopped stressing out about their lives almost overnight.

* They stopped reacting to whatever happened to them, and they began responding.

* They stopped making emotional decisions.

* They stopped settling and started dreaming again.

* They stopped being victims and began the process of taking their lives back.

In short, they began to regain control over their internal life compasses. As my friend Bill George would say, they regained their "true north." This is part and parcel of getting the Memo.

(Continues…)

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Excerpted from "The Memo"
by .
Copyright © 2017 John Hope Bryant.
Excerpted by permission of Berrett-Koehler Publishers, Inc..
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.

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