Thursday, March 19, 2009

Economic hardship suffer Few middle-class families

African-American and Hispanic families faces in this year's difficult economic times.
In measuring economic factors such as assets, education, housing costs, household budget and health care, only one in four African-American and one in five Latino middle-class families can be considered financially secure, according to "Economic (In)Security: The Experience of the African-American and Latino Middle Classes," a study released by Demos, a public-policy institute in New York.
Financial advisers who work with black and Hispanic families said they are also seeing increasing concern among their clients.
"People who were talking about asset-building and growth are now talking about: How do they sustain and maintain what they have?" said Saundra Davis, a financial planner and principal of Sage Financial Solutions Inc. in San Francisco.
"Folks are struggling more now. They're all doing some belt-tightening," said Lee Baker, founder of Apex Financial Services Inc. in Tucker, Ga.
"The struggle for middle-class Hispanics has always been a high income-to-expenses ratio, which means very little savings or 401(k) or emergency accounts," said Ruben Ruiz, chief executive of The Ruiz Financial Group in San Marcos, Texas, and author of "The One-Hour Hispanic Millionaire"


MR. Ruiz is advising his clients to increase the percentage of their income they put in savings and investment accounts, get out of debt and save money for major purchases before making them.
"I tell them, 'Before you start this, you have to take a weekend to recite to yourself and your family, to write down, to walk and talk, to scream out, 'On Monday, we are changing our financial goals and are going to have a structured income plan and get out of debt,'" he said. "You have to get psyched, because you have to make a change. There is no other way."
Ms. Davis is advising her clients to increase their emergency funds beyond the standard three- to six-month time frame and to keep more assets liquid, including those set aside for college savings.
"So much of what they do with money is emotional that I want to find out what will make them feel safest, and incorporate that into the plan," she said.
Mr. Baker said he's telling clients to use the current economic climate as an opportunity to "take a look at their life and ask what they would change."
Some suggestions he has given them include cutting expenses by considering car pooling and re-assessing their current cell phone plan and cable TV package.
Mr. Baker is also advising his clients to increase their emergency savings fund.
"If they lose their job, they shouldn't have to worry about keeping their head above water in addition to looking for a new job," he said.

African-American and Hispanic families in the middle class, broadly defined in the report as families with household income ranging from $40,000 to $120,000, have "alarmingly insufficient assets," according to the Demos study.

India's biggest fashion event started New Delhi using the global recession

Prevailing grim global mood as seen in designs showcased at the Wills India Lifestyle Fashion Week .Designers using the global recession and emotional depression to set a sombre trend for their autumn/winter collections.Models draped in black, grey and deep purple sashayed down the catwalk at the Wills Lifestyle India Fashion Week, a five-day event in which 103 designers vie for the attention of 175 domestic and international buyers.
"We are in the heart of recession, and it's fashionable," said designer Kiran Uttam Ghosh, whose "Frugality is the new Black" collection was inspired by the global downturn.
"I've combined high-street cheap leggings with luxe jackets, T-shirts with luxury shawls," she said. "You can be frugal, sensible, spend less and yet you can be fashionable."
Designer Nitin Bal Chauhan's "Condition Apply Part II" showed the underbelly of fast urban life, especially in India's capital, in a follow-up to an earlier collection.
Models acted out themes such as vanity, divorce and depression on stage wearing predominantly grey pleated dresses, trousers and skirts.
"It's inspired by the urban life, the flip side of urban life far removed from the glowing city life," said Chauhan, who added he is influenced by TV and newspaper stories of urban misery.
Models wore headgear made from junk such as spectacles, which the designer said represented lonely senior citizens left behind in a bustling city, or a study lamp, in reference to students who commit suicide because of work and social pressures.
The show ended with a masked robber strangling a model sitting on a rocking chair.
Chauhan also wove gloom from the recession, which has dented India's recent economic boom, into the designs.

"If you look at my shirts, they are asymmetric, and parts of the shirt is missing. Part of the cuff is missing, part of the collar is missing, so recession will definitely have an impact on my collection," he said.
"All my headgear are made of junk," Chauhan added. "In times of recession things that you put aside certainly hold meaning."