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#Not having money to get preferential treatment drivers

In 2016, blacks with debt typically owed $35,560-less than 40 percent of the $93,000 in debt owed by whites.

Black households have more costly debt.

The most recent data available, from 2016, show that when blacks owned such assets, they were worth significantly less than assets owned by whites.

African Americans have fewer assets than whites and are less likely to be homeowners, to own their own business, and to have a retirement account.

This is down from the approximately 24-percent gap in 1998, when the same groups of people were between 32 and 47 years old. In 2016, blacks between 50 and 65 years old and near retirement had only about 10 percent of the wealth of whites in the same age group. The gap worsens as households grow older. For instance, the median wealth for black households with a college degree equaled about 70 percent of the median wealth for white households without a college degree. The wealth gap persists regardless of households’ education, marital status, age, or income.

African Americans face systematic challenges in narrowing the wealth gap with whites.

As a consequence, blacks are more likely to fall behind on their bills and go into debt during times of emergency. For a variety of reasons, blacks are more likely to experience negative income shocks but are less likely to have access to emergency savings.

Black households have fewer and are in greater need of personal savings than their white counterparts.

Although black wealth increased at a faster rate than white wealth in 2016, blacks still owned less than 10 percent of whites’ wealth at the median. In 2007, immediately before the Great Recession, the median wealth of blacks was nearly 14 percent that of whites.

The black-white wealth gap has not recovered from the Great Recession.

In 2016, the median wealth for nonretired black households 25 years old and older was less than one-tenth that of similarly situated white households.

African Americans own approximately one-tenth of the wealth of white Americans.

#Not having money to get preferential treatment drivers

See alsoĮxactly how bad is the wealth gap between blacks and whites? According to 2016 Federal Reserve data highlighted throughout this report, there are several key drivers perpetuating the considerable wealth gap between white and black Americans: The bottom line is that persistent housing and labor market discrimination and segregation worsen the damaging cycle of wealth inequality. 6 Because African Americans tend to have lower incomes, they inevitably receive fewer tax benefits-even if they are homeowners or have retirement savings accounts. Moreover, under the current tax code, families with higher incomes receive increased tax incentives associated with both housing and retirement savings. 4 Thus, African Americans have less access to stable jobs, good wages, and retirement benefits at work 5- all key drivers by which American families gain access to savings. Persistent labor market discrimination and segregation also force blacks into fewer and less advantageous employment opportunities than their white counterparts. A well-documented history of mortgage market discrimination means that blacks are significantly less likely to be homeowners than whites, 3 which means they have less access to the savings and tax benefits that come with owning a home. Black households, for example, have far less access to tax-advantaged forms of savings, due in part to a long history of employment discrimination and other discriminatory practices. Several key factors exacerbate this vicious cycle of wealth inequality. Less wealth translates into fewer opportunities for upward mobility and is compounded by lower income levels and fewer chances to build wealth or pass accumulated wealth down to future generations. As this report documents, even after considering positive factors such as increased education levels, African Americans have less wealth than whites. 2 African American families have a fraction of the wealth of white families, leaving them more economically insecure and with far fewer opportunities for economic mobility. Unfortunately, wealth in this country is unequally distributed by race-and particularly between white and black 1 households.