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It’s all a vicious cycle. In order to get yourself a career, you need a degree. To acquire this degree, you need to go to college. College is ridiculously expensive so you are neck-deep in student loans. You assume this will all pay off in your future; your education will lead to a comfortable, wealthy life. A study conducted by Prudential Financial reveals that those very student loans that helped you attain your degree, along with other factors, will actually hinder your wealth-building.

Disheartening, but not surprising, the survey reports that college-educated African-American students are twice as likely to have student debt compared to the general population. Many African Americans are pleased to hold an expensive degree at graduation, but will have a difficult time saving or investing in their future.

The study also reveals that African Americans dislike risky business. They are half as likely as the rest of the population to possess investment products such as mutual funds, stocks, bonds and IRAs. Most blacks own life insurance and disability insurance where there is more stability and security for their future.

This study also infers that the selflessness and altruism of African Americans may also contribute to the sluggish growth of black wealth. And managing family priorities like making saving for a child’s education or leaving an adequate amount for inheritance can put a strain on one’s finances.

Finally, households with two or more generations are much more common among African-Americans. So, African-American workers find themselves financially supporting more family members when compared to other races. Some black breadwinners just do not have disposable income for their enjoyment or to save for the future.

Interestingly, the study uses the term “sandwich generation” which involves those who are supporting both their own children and their parents; this is common in the African-American community.

Despite the bleak outlook, the survey shows that African Americans are more confident and self-assured in having a better economic future than non-blacks. While the rest of the general population is focused on labeling asset accumulation as “wealth,” African Americans view life insurance, low debt, and covering health costs as financial confidence.

The underlying message of the study is that student loans keep African Americans from progressing up the money ladder, we love stability, and our families are our top priority.

For this March 2013 survey, 1,153 African-Americans participated in the study.

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