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Snapshots of Black and White Disparities in Income, Wealth, Savings and More

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Racial disparities have always existed when it comes to finances. February is Black History Month, so our researchers updated their compilation of the most readily available data on income, wealth, savings, employment and credit to provide snapshots of economic inequality between Black and white households. Here’s what we found.

Key facts

  • The median income for Black households is 37% lower than that of white households in the U.S.
  • The median net worth for Black people grew by 32% from 2016 to 2019 to $24,100. The median net worth for white people rose 4% in the 2016-to-2019 period to $189,100.
  • Black and white income gaps persist across sectors. In finance and insurance, Black people earn a median income 27% lower than that of white people. In educational services, Black people earn 8% less on average.
  • Black adults are more than twice as likely to be denied credit or denied or approved for less than requested than their white counterparts. 44% of Black adults were denied credit, compared with 19% of white adults. Meanwhile, 57% of Black adults were denied or approved for less than requested, compared with 24% of white adults.
  • The average amount of student loan debt borrowed by Black undergraduates is $36,919, 20% more than the $30,731 borrowed by white undergraduates.
Median earnings nationwide
Men Women
White $56,028 $44,694
Black $41,440 $37,283
Difference $ -$14,588 -$7,411
Difference % -26% -17%

Snapshots by type

Income

The Black and white income gap across the U.S. has remained substantial since 1970:

  • 1970: The median income for Black households was $30,400, compared with $54,100 for white households — a difference of $23,700, or 44%.
  • 2019: The median income for Black households was $45,438, compared with $72,204 for white households — a difference of $26,766, or 37%.
Household income nationwide
Median Average
White $72,204 $101,732
Black $45,438 $66,553
Difference $ -$26,766 -$35,179
Difference % -37% -35%
Additional look: In 2019, median hourly wages for Black workers were 76% that of wages for white workers. That breaks down to $16.12 versus $21.32, or a difference of $5.20 an hour or $10,816 a year for a full-time worker.

Wealth

Median net worth for Black and white families continues to fluctuate. Both races saw the same drop in median net worth from 2007 to 2010 amid the Great Recession: 28%.

Between 2010 and 2013, the median net worth for white families rebounded 2%, while Black families saw a 23% decrease in that time. Between 2013 and 2016, though, the median net worth for Black families dramatically increased 27%, and more than the 17% for white families.

That growth continued between 2016 and 2019, with median net worth rising 32% for Black families and 4% for white families. However, the difference in median wealth has increased from $134,200 in 2010 to $165,000 in 2019, after peaking in the lead-up to the Great Recession.

Black families’ median and average net worth in 2019 was considerably lower than that of white families:

  • Black families’ median net worth: $24,100
  • White families’ median net worth: $189,100
  • Black families’ average net worth: $142,330
  • White families’ average net worth: $980,550
Median family net worth
White Black
1989 $143,600 $8,600
1992 $124,600 $17,700
1995 $128,200 $18,200
1998 $151,000 $24,400
2001 $177,500 $27,900
2004 $191,100 $27,700
2007 $211,700 $25,900
2010 $152,900 $18,700
2013 $155,800 $14,400
2016 $181,900 $18,200
2019 $189,100 $24,100
Average family net worth
White Black
1989 $460,100 $82,500
1992 $398,700 $86,100
1995 $421,400 $73,500
1998 $532,900 $100,800
2001 $706,200 $103,500
2004 $763,200 $152,300
2007 $855,000 $166,000
2010 $764,900 $117,000
2013 $764,900 $108,800
2016 $989,000 $146,800
2019 $980,600 $142,300
Additional look: The net worth gap begins early in life. The median net worth for white families younger than 35 is $25,400, compared to just $600 for Black families younger than 35.

Savings

In April 2020, 73% of Black adults surveyed said they didn’t have an emergency fund to cover three months’ worth of expenses, compared with 47% of white adults.

Separately, 35% of Black families had retirement accounts — including 401(k) and individual retirement accounts — in 2019, while 57% of white families had these accounts.

Employment

More than half (55%) of Black people said they or another household member suffered a loss of income between March 13, 2020, and Jan. 18, 2021, while 43% of white people said the same. Meanwhile, 1 in 3 Black respondents expect to lose employment income in the coming month, compared with just over 1 in 5 white respondents.

The unemployment rate for white men and women 20 and older as of December 2020 is 5.8% and 5.7%, respectively, while it’s 10.4% and 7.7%, respectively, for Black men and women in the same age group.

Additional look: A white man with a college degree in the finance and insurance industry — which includes occupations in banking, investing and insurance-related activities — earns an average of $141,906 a year, while a Black man with a degree in the same industry earns $81,742 on average — only 58% of the white man’s earnings.

Credit

In 2019, 57% of Black families were denied credit or approved for less than they requested, compared with 24% of white families.

Breaking it down further: 58% of Black families making below $40,000 a year had their credit applications denied in 2019, compared with 40% of white families in the same income bracket.

Meanwhile, 86% of white families in 2019 were fully banked, but only 54% of Black families manage their finances through traditional financial services.

Tip: If you’re feeling overwhelmed by your debt and you’re unable to make on-time payments, a debt consolidation loan might be an option.

Sources

  • U.S. Census Bureau
  • Bureau of Labor Statistics
  • Federal Reserve
  • National Center for Education Statistics
  • Economic Policy Institute
  • Pew Research Center
  • Household Pulse Survey
 

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