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Sondra Helenese defines wealth in simple, direct terms: “To me, wealth is having the financial flexibility to do whatever I want to do in life.”
Hers may not fit the strict definition as outlined in principle No. 4 of the black enterprise Declaration of Financial Empowerment-to measure my personal wealth by net worth, not income-but the 22-year-old has the time to achieve her goals.
A graduate of Bucknell University in Lewisburg, Pennsylvania, Helenese still has financial hurdles to clear. For one, she has to pay off $35,000 in student loans-$334 per month-as well as another $1,100 in credit card debt. Commuting from her home in Brooklyn, New York, Helenese works as a legal assistant for Sherman & Sterling, a New York law firm, earning $30,000 a year (gross) plus overtime. “Right now, I’m not in the position to do much of anything,” she says. “Even with overtime, I still live paycheck to paycheck.”
Aside from covering $308 a month in living expenses (she lives with family friends), a sizable chunk of Helenese’s money has gone to fueling her passions. Her interest in international relations led her to take a $3,200 trip to South Africa, on which she still owes $460, and a $4,000 excursion to London, which she paid off. “I’ve always wanted to travel and see different cultures,” says Helenese, whose parents emigrated to the U.S. from Trinidad.
Her interest in music has come with a price as well. She spends about $207 a month for voice lessons-$69 per session. Another $77 a month goes to pay for workouts at the gym.
When Helenese found out about our Financial Fitness Contest on the blackenterprise.com Website, she sought to do more than travel abroad or fine-tune her voice. She sought to build assets through investing. “I want to be financially secure by the time I’m in my late 30s,” she says. “I know that one of the ways to achieve that objective is to invest in stocks.”
With fewer than 20 years to go, Helenese believes she doesn’t have another day to spare.
To get Helenese started, black enterprise arranged for her to consult with Darwin Davis Jr., a financial advisor with AXA Advisors L.L.C., based in White Plains, New York. The following are his recommendations:
- Pay down her debt. Even though Helenese is focused on building an investment portfolio, Davis maintains she should place some of her focus on whittling down her long- and short-term debt. By paying the principal on her student loans and reducing her credit card debt, Davis asserts, the amount of interest she currently pays will not eat into the total return on her investments as she starts to accrue assets.
- Begin building an emergency fund. Davis says that Helenese needs to begin creating a rainy-day fund. He recommends she put aside $100 a month in a money market account until she builds a base of $2,000 to $4,000.
- Invest in an individual retirement account (IRA). Because Helenese started her job in September 1999, she is not yet eligible to participate in her