Tuesday, October 3, 2023

Brothers, Do You Think Like a Hardly Wealthy Person?

October 31, 2011 by  
Filed under Brother Talk, Misc., Money, News, Opinion, Weekly Columns

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(ThyBlackMan.com) The biggest flaw of a hardly wealthy person is that they take their earnings at face value. If someone has a salary of $60,000, that doesn’t equate to a person having $60,000 of income. Yet, a hardly wealthy person would think just that. If this was your salary, what would say your monthly spending limit should be?

Breaking it Down

First of all, you can kiss 25% of your income good-bye to federal taxes. This doesn’t include the 8-10% gone to Social Security, Medicaid, State, and Local  taxes. Conservatively, this leaves you with $40,200. That’s $3,350 at your disposal on a monthly basis. While it’s ideal that your debt and bills, including rent, only take up a third of your income, we’re well aware that this isn’t the case for many. So, let’s take away half of that. At least 10% should go towards savings, while another 10% should go towards investments (we’re currently a fan of directly buying metals, mainly silver, not stocks). Most Americans have a myriad of monthly personal expenses like hair stylists, barbers, nail technicians, masseuses, gym memberships, etc. that also add up quickly, and sometimes exceed income, causing the credit cards to come out. We haven’t begun talking about staples like food yet.

Let’s break it down according to monthly income:

– $1,675 for bills, debt, and housing
– $168 for savings
– $168 for investments

This leaves $1,339 for food, transportation, personal expenses, and whatever needs an individual or family may need. The average hardly wealthy person goes shopping every weekend, spending several hundreds on clothing items, meaning an estimated $800 is gone before food, transportation, and personal expenses are even factored in. Let’s put that in perspective for a hardly wealthy person’s expenses. We call this the “Next Paycheck Syndrome”.

Next Paycheck Syndrome


– $1,675 for bills, debt, and housing

– $800 for shopping


After a few nights of hanging with friends, clubbing, etc., you can take a couple of hundred away, leaving you with $675 left. This doesn’t factor in food, transportation, medication (which many Americans do), beauty expenses, personal indulgences. The hardly wealthy will justify the extra expenses for which their income doesn’t support by saying, “I’ll pay this $250 off with my next $3350 paycheck in two weeks.” However, the reality is that they’re going NET $250 in the hole every month, if they continue the same lifestyle. It leaves their NET worth actually looking like this.


– $1,675 for bills, debt, and housing

– $800 for shopping

– $875 for lifestyle, food, transportation, etc.

– $250 for more lifestyle, needless spending

= -250

This yields a $3,000 annual loss.

It doesn’t matter what a hardly wealthy person earns. They generally outspend their income and justify it with their “next paycheck”. This is their thought pattern. What should month expenses look like? Well, we’re unable to tell each individual exactly what their cost profile looks like as each case must be tailored to one’s debt, marital status, household members, dependents, location, tax bracket, health, personal interests, etc. We can only give a general profile, with which we hope everyone is able to reasonably carve out their own “minority fortune” plan.

The Ideal Spending Scenario


– $1,675 for bills, debt, and housing

– $168 for savings

– $168 for investments

– $669 for food, transportation, and necessities

– $500 for personal expenses, shopping


Notice that we intentionally did not spend the entire paycheck, as most hardly wealthy people do. There should always be money left over for emergency funds. If your bills and debt are relatively less than 50% of your income, that’s a good thing! We’d consider doubling down on savings and investment, making it 15-20% of your monthly income. Do not blindly make all of your accessible money personal expenses money.

How Did You Fare?

If you assumed that more than 50%, $30,000, of your salary was at your disposal, you fit in the hardly wealthy category. With that logic, after taxes, you’d barely have $10,000 allocated to bills, debt, food, transportation, etc. We see that as highly unrealistic, unless you’re still living with your parents debt-free. If you fell in this category, you definitely need to sit down and realistically evaluate your expenses. You should only be spending .33% daily of your salary towards personal purchases. If it’s higher than this, it’s time to prioritize. Instead of envisioning yourself with the latest Prada Bag or Louis Vuitton shoes of the season, envision yourself vacationing in the south of France debt free in twenty years.

If you assumed that you had between 30-50%, we’d say you have hardly wealthy inclinations, the higher your estimate was in this range. If you were closer to thirty, this was a very reasonable estimate. However, you probably have an assumption that an entire paycheck is to be spent, even if it isn’t necessarily putting you in debt. Thinking 40% and above should be your wakeup call to evaluate your relationship with money. The advice to the hardly wealthy applies here as well.

The reality is that you should be keeping your personal expenses somewhere between 20-30%. If you chose a percentage in this range, bravo! Most Americans do not think in this way, and you’re above the pack. Keep in mind that your own personal expenses dwindle with each dependent you may have.

Hopefully, after this, you can see why we roll our eyes at every Grade F hardly wealthy millionaire on our blog. They may have earned $6 million, but they certainly don’t have $6 million to spend. Yet, their jewelry and clothing purchases alone surpass 30% of their income before bills, debt, professional services, family, and friends expenses come into play. This on top of that fact that hardly wealthy hardly ever outright purchase their homes upfront. Don’t let this unfortunate behavior happen to you!

Staff Writer; India Love

For more encouragement regarding the wealth building and management of young minorities, visit; MinorityFortune.

Also connect with them via Twitter; http://twitter.com/minorityfortune.


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