Rap masters could help bridge the financial literacy gap
This article is the last part of the FT’s Financial Education and Inclusion Campaign
Rappers probably aren’t the people that come to mind first, or even second or third, when you think of who you might turn to for financial advice. In fact, quite the opposite. In the popular imagination, they are seen as the epitome of reckless drinking – driving around in Bentleys, dripping in jewelry, drinking Cristal from hot tubs on superyachts.
Take Kanye West, who would spend $500 a day on haircuts and have a recreation of the Sistine Chapel ceiling in one of his many homes — with him as an angel, of course. And the list of bankrupt rappers is just as rich. The best known is probably 50 centsincluding studio debut Get rich or die trying was the best-selling US album of 2003. In 2015, he filed for Chapter 11 reorganization before later paying off his $22 million debt and being granted a release.
However, I am currently watching a video in which Kendrick Lamar (who recently wore a crown of thorns set with Tiffany diamonds on stage) is paired with Ray Dalio, the 73-year-old billionaire investor and hedge fund manager. Their mission: to improve financial literacy.
The ExavierTV comedian begins with an impassioned street slang spiel about making money, which he intended to put into a barber shop. He then lost everything while playing dice with a friend called Peanut. This is translated into plain English by Kendrick Lamar for the benefit of Dalio, who offers his view that you should avoid the lure of quick and easy returns and exploit compound interest. “Basically, what [Dalio] says, bro, is that the slow money wins the race,” Lamar explains.
Lamar isn’t the only rapper on a mission to educate his fans about money. Lecrae, a mainstream Christian crossover rapper, has teamed up with credit reporting firm Experian. The approach here is simpler: Lecrae speaks directly to the camera about the importance of credit scores in a relevant way.
A third, slightly different example is Jay-Z and his Bitcoin Academy with Twitter co-founder Jack Dorsey — a series of classes offered free this summer to tenants of Marcy Houses, the public housing estate in Brooklyn where Jay-Z grew up. Of course, the recent bitcoin price drop is not a big advertisement for crypto. But, for all its flaws, Bitcoin has also reached a demographic that shared ownership never reached, so perhaps the idea of using it as a gateway to financial literacy has value.
These form an interesting contrast to traditional financial literacy efforts, many of which can be dignified and boring. There are plenty of books. There are boosted videos that look like sales seminars (like Grant Cardone’s) and naturally focus on emulating the habits of Jeff Bezos and Elon Musk. You can watch Warren Buffett’s speeches, and they’re pretty good too. But somehow, I doubt many financially disinterested 19-year-olds do.
One of the most interesting initiatives comes from Santander Bank, which has teamed up with British TV personalities Ant and Dec to make a humorous video aimed at school children. It’s aimed at a younger audience than the rappers’ videos, and the message gets lost in the joke a bit, but it’s fun and friendly. This is the biggest challenge. Learning good money management is not exciting and easy to put off for years, so young people in particular tend not to.
Polly Gilbert, director of marketing at mortgage broker Tembo, says low financial literacy is a problem. “We talk to people all the time who don’t understand the basics of finance, like how mortgages and interest rates work. It’s clear that the younger generation isn’t learning about it or necessarily prioritizing it,” she says.
It’s true that financial education videos featuring rappers could be considered rather self-promotional for artists, but I’m not sure that matters. With most rappers, large-scale self-promotion is part of the package, and furthermore, with financial literacy, you want to spread the word. A good number of rappers do something more quietly – Drake and Diddy are well known for their philanthropy while Eminem gives quietly without fuss about it.
And, although they often live in large numbers, many are very financially savvy. I remember once being interviewed Eminem in which he started talking about his pension. The rapper-to-entrepreneur pipeline is well established. Jay-Z is a billionaire, thanks in large part to his non-music business endeavors, as is Kanye West. Snoop Dogg turned his passion (marijuana) into a business with his venture capital fund Casa Verde. There are dozens more.
Are people like this more likely to make their way among people with low financial literacy than most of the wealthy people on the Forbes list? I suspect they are, even though their lifestyle may seem at odds with common sense when it comes to money. As Gilbert says, “If someone can see themselves in Kendrick Lamar a bit, then his financial advice will lodge a bit more in their conscience.”
Rhymer reads. . .
White City by Kevin Power, a satirical literary novel whose drug-addicted narrator navigates his way through a disastrous real estate deal. Critics compared him to Martin Amis.
Follow Rhymer on Twitter @rhymerrigby
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This article is published by FT Wealtha section offering in-depth coverage of philanthropy, entrepreneurs, family offices, as well as alternative and impact investing