Letter From The President

Economic Franchise Value is an important term that you need to think about how it relates to you. You should think of your family unit as a franchise that you must protect, nurture and grow, much like a sports team or a corporation. Each family unit has an EFV. EFV is the net value of your personal assets, assets minus liabilities/debt, also known as wealth. There have been numerous studies conducted showing the 3 common denominators that millionaires [people with high EFV] and other wealthy individuals share. The factors are:

1. Home Ownership - has obvious benefits over renting. In the early years of home ownership, one can deduct the great majority of the monthly mortgage against one’s taxes. This generates enormous savings in the form of reduced tax liability. Widely overlooked, and the most important benefit of home ownership is the ability to ‘asset transfer’. A home is usually the largest asset of a person/family. In most cases, parents who have built equity in their home for decades either leave the actual house to offspring or sell the house to buy a cheaper one, leaving the profit of that sale to children. Recent tax changes make it even more advantageous for home owners to shield from tax the profits of selling a home, leaving more assets behind for their beneficiaries. Owning a home includes you in a group that continues to get favored treatment and to increase your assets. Home owenership is one of the surest ways of increasing your EFV.

2. Small Business Ownership - is another way to grow your EFV efficiently. Income earners in the highest income bracket are taxed approximately over 50% when you combine federal, state and local tax. The small business owner, on the other hand, has the option to reduce taxable income by contributing to retirement plans.

3. Financial Assets - is the final way to grow your EFV. Against the odds, Black Americans have made great progress in the first two areas, but have been slow to get on board in acquiring financial assets. Financial assets is the one denominator that generates wealth faster, on average, than any other. Its the easiest of the three to participate in immediately. Financial assets are stocks, bonds, mutual funds etc. For everyday Black Americans and other minorities, financial assets are a must have to increase your EFV.

Historically, Blacks have been discriminated against in unbelievable proportions by being denied housing in the 1940s and 1950s when the government initiated the biggest push for home ownership in history. FHA [a loan originator] practiced racist policies in its loan origination intiative. Research shows that from the early 1930s to the late 1970s, the government initiated a massive program for renters to become homeowners. It’s documented that it became easier to own a home than it was to rent an apartment. This government, however, structured a framework of evaluating the creditworthiness of potential homeowners that was racist and prevented Black families from increasing their EFV like other families. This practice against Blacks has had a long lasting negative effect on Back economics lasting even until today. This has led to a cumulative disadvantage for Blacks, generation after generation.

The rich get richer. Its not just a saying - its true. Why is that? Simple. The rich have been benefiting from years of advantages from not only having easy access to the three EFV builders, but by being the benefactors of laws passed that allow them to maintain high EFVs. These groups have the benefit of decades of EFV compound growth. How come you aren’t rich? Is it important to care about money? Should your life be driven by the pursuit of money? What does money do for you in this society?

Incredible changes have occurred in the last 20 years that make it possible for people who have been excluded from wealth creation strategies in the past, to participate more so than ever before. The greatest change has been in the dissemination of information. The fact that you and others can read this message online is itself a miracle. Unfortunately, information by itself is of no value. Once you get information, you need to filter out the bad, and act on the good. Each generation has more access to information. It has never been easier to buy a home, start a business and set up an investment portfolio. Interest rates are at historic lows and banks are becoming more accommodating with their lending behavior.

There are many organizations that want to assist the small business startup by providing tax breaks, low interest rate loans and grants. And there are companies like The Bryant Group that help individuals to participate in the accumulation and growth of financial assets. The internet is a driving force behind leveling the playing field. From disseminating information to connecting clients to service providers, the internet has great potential to help reduce the wealth gap.

High income is a good start, but not a requirement. The Bryant Group has countless clients who are white collar professionals earning six figure salaries, yet are living from paycheck to paycheck. At first glance, wealth accumulation appears to be even more difficult than attaining a high income. That is not true. But a well thought out financial plan, discipline and patience will allow you to set your own financial goals and reach them.

This is a new era. The information is readily available. Collective economic groups like The Bryant Group as well as others make it possible to increase your EFV. You need to seek out information, educate yourself, get comfortable with concepts that you haven't been comfortable with by nature [risk, delayed gratification]. When you grow and maintain your EFV, you will have the choices that all Americans deserve: quality of life, a decent education, good health care, control of your time, philanthropic choices, etc. Calculate your family’s EFV. Then, make the decision to grow it smartly for the benefit of you and the generations that will come after you.