Morgan Stanley
  • Access & Opportunity Podcast
  • Jun 11, 2021

Community First: Building Latinx Wealth

Transcript

Rita Soledad: Growing up, I didn't think that someone with my background growing up in a neighborhood like my neighborhood could ever build wealth.

Beatriz Acevedo: We want to meet you at whatever stage of your financial journey. And we made it very accessible to feel like you belong in the money conversation.

Carla Harris: Welcome to Access and Opportunity, I’m your host Carla Harris and I’ve got some exciting news to share with you. Through the years we’ve told the stories of entrepreneurs, investors and change agents working to reframe the narrative and help close the funding gap for businesses led by women and people of color.

And now, we want to take it a step further. We know that the topics we’re tackling are big; they impact how we approach business, economics, policymaking and social issues. That’s why, moving forward, we’re expanding the conversation. Through the stories of individuals working to make change within their communities, we’ll provide our listeners with context about how we got here and share tangible examples of how ideas around access and opportunity are being made real every day.

So, if that all sounds good to you, stay with me -- or come on and join me for the ride.

On today’s episode, we’ll take a closer look at the wealth gap through the eyes of two Latinas working to educate and empower their communities. As we know, building wealth is the cornerstone of financial planning, however it’s much harder to do when you’re at a disadvantage from the start.

This racial wealth gap has only grown over the last half century with White families seeing dramatic increases. So today we’ll speak to entrepreneur Beatriz Acevedo about her journey to spread financial literacy. But first, we’ll hear the story of Rita Soledad, who, at 33 years old, had some big news to share.

Rita Soledad: When I became debt free, I shared it on my Instagram

Carla Harris: Getting rid of debt had been Soledad’s dream for years, but now that the day had come, the reaction she got was not quite what she was expecting.

Rita Soledad: No one in my personal life said, “Congratulations,” or, “Yay!” And so I felt at that moment I must be the only one who had debt. I must be the only one who was in this financial situation.

Rita Soledad: You know, months later, I learned that that wasn't the case, that really my loved ones also had debt. And if anything, it made them think a little bit more about their financial situation and it was uncomfortable so they just wanted to avoid it.

Carla Harris: And this lit a spark in Soledad. She wanted to share her financial knowledge with her community, but first she would have to reframe the entire conversation about money.

Rita Soledad: My name is Rita Soledad Fernandez Paulino, you can call me Soledad. I am a former math teacher turned personal finance enthusiast.

Carla Harris: Soledad provides financial advice to communities of color, LGBTQ, and women through social media platforms and her company WealthParaTodos. But her story began in Echo Park, Los Angeles, where growing up she first became aware of the financial struggles around her.

Rita Soledad: My mom was a single mother in Echo Park, raising children in a neighborhood where there was drive bys and there was, you know, gang violence and there was a lot of poverty. This was also a community that had a lot of undocumented people. So there was a lot of fear in the neighborhood around agency. So my mom had her hands full. And I share all of that because I think it's important to understand that she didn't have the time to develop her own personal finance literacy, right? So she was raising children in a time where it was like, “Yeah, take on debt,” you know, “Let's, you know, buy a house.” Everyone was able to get approved to buy a house, and yet my mom couldn't afford it. I got a lot of messages growing up saying, like, “If you have the money, spend it,” because you don't know when you're going to have the money again.

Carla Harris: As Soledad got older, she started to educate herself about things like credit scores and debt.

Rita Soledad: I spent my 20s avoiding debt, but then when I was 32 years old, I started reading personal finance books again and I learned about budgeting, which is something that I had never been exposed to. I had taken so much pride in having a good credit score. However, your credit score just tells you how well you managed debt. It doesn't tell you whether you're building wealth. And so, as I learned about net worth, I started just becoming very curious.

Carla Harris: The more she learned, the more she was able to take control, and by budgeting and living below her means, Soledad achieved her financial goals by 33.

Rita Soledad: By the time I became debt free, had started to build an emergency fund, I wanted to talk to all my friends about this, because I felt like, “Oh, wow, guys like wealth is something that we can actually build.” Growing up, I didn't think that. Growing up, I didn't think that someone with my background growing up in a neighborhood like my neighborhood could ever build wealth. I thought it was something for actors and football players and basketball players. Or honestly, I thought it was something for white people.

Carla Harris: For many communities in the United States, building wealth has always been a challenge for a cross section of reasons like discriminatory policies in employment and housing and lending practices.

But despite everything she was up against, Soledad knew that she could push back against the cycle through financial literacy. And maybe she could spread the word.

Rita Soledad: So I wanted to tell my friends, I wanted to tell them and, you know, my cousins and I was just like, “Look, look, this is what we got to do. We got to become debt free. We got to build an emergency fund. Then we start investing and let’s, you know, work on opening up a Roth IRA and maxing out our retirement accounts.” And no one wanted to have those conversations with me. So eventually I just started talking about building wealth on Instagram so that I could have a community that could keep me accountable towards this new lifestyle that I was building and also just so that I didn't feel so alone.

Carla Harris: And from there, Wealth Para Todos was born. She was determined to help others get the information they weren’t getting elsewhere, and to change the conversation about personal finance from shame to empowerment.

Rita Soledad: Like it's crazy, it's crazy, the gatekeeping that happens within the personal finance world because people’s content is so focused on like cis-heteronormativity. And also, just like even within my own studies, the examples a lot of times are like so-and-so wants to buy a boat and it's like, no one in my neighborhood is buying a boat. You know, that's not something my people are asking about. My people are asking about, “Even though I don't have a Social Security number, can I still invest?” “How do I help my parents with their retirement, because we just became, you know, citizens and they don't have access to an employer retirement account. How can I help them?” It's just a different perspective, it's different questions, different needs.

Carla Harris: Overcoming the generational wealth gap is no easy task, but Soledad is dedicated, and she’s moving forward one step at a time.

Rita Soledad: Currently, I'm still just like the one-woman show, right now I'm doing everything. My dream, my ultimate dream, is I would love to open up a community center here in my neighborhood. [cries]. It makes me cry because as a little girl, I remember going to El Centro de Pueblo, it's a community center here in Echo Park, and they gave out Christmas presents to us. So I think about them. And I would like to build something like that, a community center, but that also provides personal finance, literacy education to the youth, but then also can provide one-on-one coaching to parents. So that's the ultimate goal, I think for me, that it becomes something here in my neighborhood.

Carla Harris: Soledad’s company, WealthParaTodos, offers seminars, consultations, newsletters, and plenty of free advice to those who need it.

Carla Harris: In May of 2020, Beatriz Acevedo, a former TV and radio star, co-founded a digital platform called Suma.

[Suma Wealth audio clip: “We are Suma, an online community made for latinos by latinos to learn how to save money, build wealth, and make mucho dinero.”]

Carla Harris: Beatriz and I sat down to talk about her journey, the importance of trust in communicating a message, and when it’s time to reconsider some of the financial lessons our parents taught us.

Carla Harris: Beatriz, thank you so much for being here with me today. It's a pleasure to have you on the show. Are you ready to jump right in?

Beatriz Acevedo: Thank you so much, Carla, for inviting me. And I am ready to jump right in.

Carla Harris: OK, well, let's go back to the beginning of your career. I understand you started out in radio and television and saw great success in that world. What awareness did you have of the personal finance and wealth when you began your career?

Beatriz Acevedo: Well, listen, I started very young working in radio as a child announcer. It certainly set me out in my financial journey. My parents were big believers that we needed to work for what we wanted so they would set up a budget and say "Listen, our budget for tennis shoes is twenty dollars, so you will need to work for the other twenty two dollars.” So early, early on, you know, they were like, "The budget is this." So I had to learn from what a budget was, what the difference was, and how I would need to hustle to make the difference if I wanted these brands, right? So I started very early on, I think as an entrepreneur. That's what set my career as an entrepreneur, I would sell pies and cookies and cakes after school in the building where my father had his law practice.

Carla Harris: It was excellent because it taught you about the value of money. It wasn't just that your parents had it, but it gave you a sense of relative value: $44 -- I have $20. I need to go get another $22. How can I do that? Well, people sell things in order to get money so, wow, your family's philosophy and approach to money very early on sounded like not only did they educate you about money, but they really instilled in you the value and your responsibility to get it yourself.

Beatriz Acevedo: Absolutely. And how I really became an entrepreneur was the day I was fired from my job. Very unpredictable, that I would be fired. I was on covers of magazines, I had the biggest ratings, I'd won an MTV Award as a director, everybody would talk about me. And one day I received a fax in my office from some coordinator person I've never met saying every single one of my shows was canceled. And at the time, they wouldn't really fire you from the network. They would just put you in something that they would call the “refrigerator,” el refrigerador. And that was something that was reserved for women. For women who did not stay in their place. For women who were more vocal than others. So here I am in my very early 20s and I get this, you know, this fax saying every single one of my highest rated shows were canceled. And my mother, when she hears me say I was fired from my job, she's like, "No, mijita, you were not fired. You decided to quit." I'm like, "Mom, that's like being fired." Today, I would take that in a heartbeat and, you know, use the money to do philanthropy. But in my early 20s, I was a bit more, chip on my shoulder. And I'm like, I resign to this job. And that was also a very interesting money lesson because I had no savings, right? In my 20s, although my parents had instilled a lot of money responsibility for me when I was a kid, you just feel like you're so on top of the world, right? I am getting paid incredibly well by this network. There's nobody like me. I was at a supermarket trying to buy a carton of milk. I saw that there was a magazine right there, when you check out they have all these magazines, I was in one of them -- and my card was declined. And I remember crying outside of this Mexico City supermarket for hours just thinking, how did I go from here to nothing within a few weeks, right? And that was a big lesson. That was a tough lesson, for me to say "Never again will I not have a safety net or an emergency savings account."

Carla Harris: So let's dig into your journey with Suma Wealth. And how did that start, and what inspired its creation?

Beatriz  Acevedo: Actually, the idea for Suma Wealth was not mine. It was my co-founders, Javier Gutierrez, who comes from the financial world. And he had this idea probably for a good decade. He was like, "I need to find somebody with a marketing mind to help me launch a company that is all about financial education, financial inclusion. But that comes at it from a very different angle, right? That somebody that can really build this trust and community first, content first, as we also build obviously either potential relationships with other fintechs or traditional banks, but somebody who has that different mindset." So when he pitched this idea to me a few years back, I thought, he is absolutely out of his mind, because, you know, I'm a marketer. I'm a marketer at heart. And the more, you know, obviously was very timely with the pandemic, with the economic downturn. And there was so much confusion of, “How do you apply for a PPP loan? What is furlough? Can I collect unemployment if I'm on furlough?” There's so many questions that are -- my community in particular, even though they speak English, they speak Spanish, and the information was both, it was still confusing. It was still overwhelming. It was still difficult to understand. So I started it as an experiment on Instagram with a simple page over the summer thinking, "Well, let's see where it goes. Let's see if people are attracted to content that is very fun but very useful at the same time." And in my previous venture at Mitú, we were able to reach massive critical mass with content that was very unapologetic Latinx that really spoke to this US-English dominant born Latino youth. So we thought, "OK, I'm going to give it a try and see how it goes." And the reaction from the audience was incredible. The engagement was off the charts, and it was great. I mean, the majority, I say 99 percent of our investors are women and women of color. So I'm proud of who's on my cap table. And that really, really matters to me. I did not need to over explain to these investors why our communities matter, why this was important. It was almost like, yes, we grew up exactly that way and we know why this matters. So we want to back you and support you in this journey. So, incredibly lucky that I have the support of both the community with the response that they've had so far and from the investment community as well.

Carla Harris: So, what did you say to get this started? You already had an audience where you were talking about, as you said, things that were unapologetically Latinx. But what did you say to this community around money? You know, around wealth building? Because, again, it's not that it's a taboo subject in communities of color, but it's often misunderstood. It's often not talked about at all. It's sometimes a point of shame. So what did you say to them to get them hooked to light that fire?

Beatri Acevedo: I think the two biggest messages and one is our slogan, which is, "Building wealth juntos, building wealth together," was, we are like you. We want to meet you at whatever stage of your journey you are, financial journey. And we made it very accessible to feel like you belong in the money conversation. I think that's a very important thing to talk about, belonging, right? So we kept saying, you belong in the money conversation. This is a brand built by people like you, for you. And everything that you saw and you see it on our site tells you that, screams that at you, every message. And it's not that the content is in Spanish, but for example, when we try to explain a soft and an a hard inquiry on your credit, we decided to do that post on a Tuesday, which was, you know, trending Taco Tuesdays, and we decided to show it with a hard tortilla, and we explained in an analogy of that what was a hard inquiry. And then with a soft taco, what was the soft inquiry. So always food and finance go really well in our community. But things that you relate to. For example, our grandmothers and our mothers kept cleaning our homes with this purple liquid called Fabuloso, right?

Carla Harris: It's not just your grandmama, honey.

Beatriz  Acevedo: Exactly, so we had an image of a Fabuloso, and we would say, "If only Fabuloso could clean up your credit. But since it can't, here are three things you need to start doing.” So when you see that, you're like, "Oh, wow, no one's shown me finance this way, right? This is for me. This is by somebody like me. I do belong in this conversation." So I think it was that, it was that sense of, you belong. And we are just like you and we are here to support you. And this is a community that's going to be building wealth all together.

Carla Harris: Now, you took a holistic approach. Why did you think that was important? And what else did you put into your equation that you didn't see in other platforms?

Beatriz Acevedo: I took a very unorthodox approach, Carla. I decided to lead with community. I decided to lead with content and culture. And I decided to do very heavy listening into what my community truly needed before I thought, I know better than anybody, and I'm going to launch with a product that I think, along with other Latinos, that our community needs. So that is a very nontraditional way that you approach a fintech company. As you know, most fintech companies, they launch with a product first and then they decide if we build it, they will come. That does not mean that we don't obsess every day in how we're building our products and when we're going to launch. But it is based on every single insight that we have gathered from the day that we launched.

Carla Harris: So it's very interesting. If I could give a playbook point here for a second. You have endeavored to build the trust first. And when we think about communities of color, there's obviously trust issues when it comes to health care, which we've been talking about obviously in the last year because of this pandemic. But there's trust issues big time when it comes to money. So you've said, "I get that. I understand that. So I'm going to give you content that you can use. I'm going to fulfill the appetite that you told me you had. And then we're going to talk about some products, because if you trust me and you've learned from me now, I think I have products for you that you'd be able to use. I hear you."

Beatriz Acevedo: Absolutely. And it's so interesting that you just did that recap, because the top two questions we have on every single one of our posts are "Who can we trust and who do you trust?" Right? That is a lot of power and that is a lot of responsibility. So that's why, so far we have not really inked any sort of partnerships, not that we won't, but we want to be very, very careful on who those partners are. We want to make sure that we have vetted them many times and that when we tell our community this is who we trust and you can trust, we are 100 percent sure of that. So trust is paramount in our communities, right? Trust comes before product. Once our community has information, to your point, they're ready to go. The day we did a dinero session on fractional shares, for example, they were ready to fund their accounts, were ready to start buying their fractional shares. So we do need those products. We do need those services and those partnerships. But at the beginning, it was very important that they started with the content, with the learning and with the trust and with the community.

Carla Harris: Let's talk a little bit about the wealth gap in the Latinx community, because when people talk about the wealth wealth gap, you mainly hear people talk about that in the African-American community. But let's talk about it in the Latinx community.

Beatriz Acevedo: So today we are about 20 cents to a dollar of what a Latino household has versus a white household. So there's definitely a big disparity in those 80 cents. Why this matters in the same way that it matters with the African-American community as well, is because we are the new majority. When you look at youth, there has never been such a multicultural America than today. So when you think about GDP growth, when you think about who is going to be driving this economy forward, it's our communities. So if we don't make a very conscious effort today to empower them and to help them close this wealth gap, how are they going to be when it's the majority? There's no number that is going to work out for all Americans. This is not a problem in the Black community. It's not a problem in the Latinx community. This is a problem for all Americans because we are going to be responsible for driving the economy forward, so it is a problem, or it is a challenge, or it is a commitment that all Americans need to do if we want to see that our country continues to thrive for all of us.

Carla Harris: I could not agree more. What misconceptions have you learned as you have engaged with this community? The misconceptions that they have about wealth and financial literacy or security?

Beatriz Acevedo: There's so much there, right? I mean, we hear a lot of comments from people in our community that say, "Oh, my gosh, my parents told me to never ask for a credit card because I should only pay in cash for what I can afford." And maybe the parents meant well. But that means that then a lot of people in our communities have not built their credit. The other one is we grew up with a lot of horrible sayings in our community from our grandmothers and our parents of like, you know, "El dinero es el diablo," you know, "Money is of the devil." You know, like once you have money, you turn into this terrible and horrible person. My father had a big issue with money. He came from absolutely nothing. He worked four or five, six jobs, including being the janitor of a building where he could live for free while he went through law school. And he was a super brilliant mind. He was cleaning toilets and writing speeches for the Mexican president, right? There was nothing that he would think, "Oh, you know, I'm such a brilliant mind. I write speeches for the president. I'm not going to clean a toilet." He would do anything he had to do to get through college, to serve his community. But he, the money, it made him feel absolutely dirty. So I think, you know, for a lot of people in our community that grew up with that, I always say you always can give it back to char -- build it, have it, and then you can always give it back. Also, I think another misperception is that and there's some truth to it, but Latinos are very much of the mindset because of the countries that we come from that there's no tomorrow. Tomorrow is not guaranteed, which is true in a way, but that does not help us when it comes to saving and investing. So we are, as you know, in the demo, the demo that spends the most but saves the least. And that is a very big problem because we come from countries where, like tomorrow, there could be a devaluation. Tomorrow there could be a change in regime. Tomorrow, the political party opposition can take over. So everything is live up to the day. But the mentality of "never think of the future" is another one that just doesn't let us -- and I have to say, my journey, even investing, is because I married a non-Latino. The day I got married, I, you know, my husband told me, "Listen, we are going to start this plan for our children's college." And I was like, "What are you talking about? We have no kids, no need to save for college." And I think that is what we are now trying to change with this content, with these partnerships, with these products and services at Suma to start very early on to tell our community "You do belong in this money conversation and this is for you, and this is how we can change the narrative within one generation." Right. If we focus on these zillennials, the older Gen-Zs and the millennials who are the biggest influencers in their families and in their communities, then we're able to really influence the older generations and as they become become parents themselves, the next generation. So I'm very, very hopeful that if I'm able to do this at scale within one generation, we can really see transformative change.

Carla Harris: Well, I have to tell you Beatriz, I love this conversation, because you've made so many great playbook points. And that, number one, study your relationship with money and look at where that might have come from, who might have influenced it, and understand that you're living in a different space. Number two, recognizing that you have a long runway in front of you and what money does for you and what wealth does for you is gives you a multitude of choices, because when you don't have it your choice set gets very, very small. You've touched on so many things. So I have one more question that I want to ask you before we get to our lightning round. And that is what's next? What's next for Suma Wealth? And you know what, what parting message would you give to our audience? What would you tell them today, knowing what you know now that they can do?

Beatriz Acevedo: What's next is we're very excited to launch a financial checkup, which is going to be great and free and available to, not just our community, but any community. And it'll be just like when you go to the doctor every year and they check your blood and they tell you, "Listen, you're a little bit out of range here, here, here." And then we'll be able to guide you knowing where you are out of range into, you know, being able to get into those ranges and eventually financial stability, but with the goal of financial prosperity. That'll be our first product. So we're very excited about that. Message for our communities is: start now. Right? I mean, this is the time, and there's so many things that we didn't have growing up. But today, there's so many ways to start. So educate yourself as much as you can. There's so many great resources, not just from Suma Wealth, but from other companies that are aimed at youth and making it easy and fun. Find your community, find your tribe, and be an advocate for your friends, for your community. You do belong in this money conversation and we can't wait to see what you start building. And you can start with one dollar a day investing makes so much, so much difference.

Carla Harris: All righty, Suma Wealth, ladies and gentlemen.

OK, we have a lightning round where it's our tradition in Access and Opportunity and it's our opportunity to have our listeners get to know you a little bit better as a person. So I'm just going to tick through a few things. And you tell me the first thing that comes to your mind. Are you ready?

Beatriz Acevedo: I'm ready.

Carla Harris: OK, personal mantra.

Beatriz Acevedo: Being different is your superpower.

Carla Harris: Alright, city or countryside?

Beatriz Acevedo: Countryside.

Carla Harris: Winter or summer?

Beatriz Acevedo: Summer, always

Carla Harris: Telephone or text?

Beatriz Acevedo: Text.

Carla Harris: If you had a talk show, who would you want to be your first guest?

Beatriz Acevedo: Oh, my God, that's so hard.

Carla Harris: Living or dead.

Beatriz Acevedo: Living or dead. I'd say Frida Kahlo.

Carla Harris: OK, one word to describe your legacy.

Beatriz Acevedo: Generosity.

Carla Harris: OK, Beatriz Acevedo, muchas gracias.

Beatriz Acevedo: Muchas gracias, Carla, thank you so much for having me. Thank you for all the work that you do to support our communities as well. And it's been a pleasure.

Carla Harris: Thank you, pleasure's been all mine.

Carla Harris: You know, hearing from these two ladies, I’m struck by how much their stories intersect. Even though Soledad grew up in California, and Beatriz in Mexico, there was significant overlap in the messages they both received from their grandparents and their parents about personal finance and wealth.

I think it just shows how deeply our culture affects how we approach and engage with money. It’s generations deep. And I love that these women are really focusing on the new generation with their advocacy through mediums like Instagram and TikTok and YouTube. They’re meeting their community where they are -- or as Beatriz says, leading with community.

I think the word I’m left with after hearing about Soledad with Wealth Para Todos, and Beatriz with SUMA Wealth is: energized. What they’re doing is fresh and so, so relevant and I can’t wait to see where they take their platforms next.           

So, I want to thank Soledad and Beatriz for sharing their personal journey’s to wealth and community advocacy with us today. It was such a pleasure to speak with them both.

Thank you all for joining us on this episode of Access & Opportunity highlighting the racial wealth gap and sharing the voices of these two Latinas working to foster economic parity within their communities.

What did you learn today from Soledad and Beatriz? And what were some takeaways from the season as a whole? Send us your thoughts at carlapod@morganstanley.com. We would love to hear from you. Subscribe to Access & Opportunity on Apple Podcasts or wherever you listen. Thanks for coming along!

On this episode, Rita Soledad Fernández Paulino shares her journey to debt free and how she’s breaking the stigma around money talk in her community. Then, Carla sits down with Beatriz Acevedo, entrepreneur and co-founder of SUMA Wealth, a digital platform that empowers the Latinx community to build wealth.

On this episode, we’re tackling the racial wealth gap from the perspective of two strong Latina founders who are flipping the script around finance in their communities. We hear from Rita Soledad Fernandez Paulino, the financial literacy influencer behind Wealth Para Todos, an online community that was born of Soledad’s own journey to become debt free. Then, host Carla Harris sits down with media entrepreneur Beatriz Acevedo, a former television host who found her voice in advocating for financial literacy in diverse communities after her own money troubles. She now leads SUMA Wealth, an online platform she co-founded to create financial education content that speaks to Latinx youth. Come on and join us for the ride.

 

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