It Will Take 228 Years For Black Wealth To Match That Of Whites
Ever take a look at the Forbes 400 annual listing of Americans with more than $1.7 billion in holdings–there are only two Blacks listed. Even though we keep celebrating the fact that African Americans’ buying power reached $1.1 trillion in 2015, Black wealth still lags woefully behind that of white Americans. Due to a lack a wealth building in the Black community–we tend to spend our money outside the community and don’t save or invest as much–it will take Blacks in America hundreds of years to just to catch up to white wealth.
Specifically, it will take a whopping 228 years to close the wealth gap between Blacks and whites in America. This, according to a just released report from the Corporation for Economic Development and the Institute for Policy Studies. Latino families will fair a lot better–it will take them 84 years to close the gap.
It seems white wealth keeps growing, while the wealth of other groups isn’t. “Over the past 30 years, the average household wealth of white families has grown 85 percent to $656,000, while that of Blacks has climbed just 27 percent to $85,000 and Latinos 69 percent to $98,000,” reported CNN. The report covered the average wealth of Black, Latino and white households in the U.S., with wealth defined as the value of assets (home, retirement savings, etc. but not durable goods such as cars and electronics) subtracted from the debt owed against those assets. Factoring in population growth and the fact that by 2043 whites will be the minority in the U.S., the racial wealth gap between Black and Latino households and white households will actually double from $500,000 to $1 million, the report found.
The report also proved money is staying in the hands of the few. “We’re seeing wealth concentrating in fewer and fewer hands and those hands are overwhelmingly white,” Josh Hoxie, head of the project on opportunity and taxation at the Institute for Policy Studies, told CNN.
Besides spending and savings/investment habits, there are other reasons for the gap as well–such as minorities being the targets of subprime and predatory lending during the housing boom. “In addition, provisions in the tax code, like the estate and inheritance taxes, benefit wealthy Americans who are more likely to be white,” said Hoxie.