New Ariel-Schwab Black Investor Survey Shows Black Americans Continue to Trail Their White Counterparts in Building Wealth - Seite 2

401(k) Plans and Beyond

Over the last several decades, 401(k) plans have become an important gateway to investing for many Black Americans, with 63 percent of Black investors having first invested in the stock market through a retirement plan. Ownership rates of 401(k) plans are now similar between Black and white Americans (53% vs. 55%). But savings rates show meaningful differences. Specifically, white 401(k) plan participants invest 26 percent more per month toward their retirement accounts than Black 401(k) plan participants ($291 vs. $231).

Beyond investing, the survey finds that Black Americans are less likely than white Americans to own almost every kind of financial vehicle, with the exception of whole life insurance, which is favored in the Black community. They are also less likely than white Americans to have written wills, financial plans, or retirement plans.

For Black Americans, disparities grow every month; while they save $393 overall per month, whites are saving 76 percent more, at $693 per month. Even Black Americans who earn more than $100,000 a year consistently save or invest considerably less than their white counterparts at the same income level.

“These differences are not new. Black Americans are disadvantaged from the outset when it comes to building wealth,” says Hobson. She notes that while 51 percent of white Americans say they have inherited wealth, just 23 percent of Black Americans have.

Schwab-Pomerantz points out that more white Americans (44%) than Black Americans (33%) are focused on preparing for retirement as their most important financial goal. “For so many Americans, the 401(k) is the first step to becoming an investor, and while it’s encouraging to see greater parity among those who have access to this opportunity through their workplace, it’s incumbent on employers and all of us in our industry to help 401(k) owners save more throughout their earning years,” she says.

Trust Remains an Issue

Trust in the financial services industry continues to affect stock market participation among Black Americans. While similar proportions of Black and white investors believe that financial services institutions are not trustworthy (23% vs. 20%), only 35 percent of African American investors feel they are treated with respect by financial institutions versus 62 percent for white investors. Additionally, Black Americans are considerably more likely to cite the importance of racial diversity within the employee ranks at investment firms (63% vs 27%).