According to the New York Times, for every $100 in white family wealth, Black families have $5.04.
Wealth is different than income. Wealth is calculated by adding up your total assets, like cash, property that appreciates in value, and retirement accounts, then subtracting liabilities like debt, loans, and mortgage.
According to the Economic Policy Institute, 1 in 4 Black households have ZERO net worth. Even a Black family with a graduate degree lagged behind its white counterpart in wealth by more than $200,000.
Black households are projected to lose 18% of their wealth by 2020, and if the trend continues then our collective wealth will hit zero by 2053.
Differences in wealth between Black and white people have deep historical roots. Slavery and Jim Crow policies kept Black people from building wealth for centuries, and it was all on purpose.
Homeownership is recognized as a key part to building wealth and it’s typically been out of reach for many of us. “Redlining,” the act of determining “good” and “bad” neighborhoods for loans by race, led to 98% of home loans going to white families from 1934 to 1962.
This disparity in ownership gave white people the ability to build household wealth, and borrowed against the equity accumulated to invest in things like college and entrepreneurship.
As a result, white people’s wealth grew substantially and was passed down to future generations, resulting in the gap we see today.
The wealth gap is the result of CENTURIES of systematic exclusion of Black people from wealth-building mechanisms. So we must continue to bring this issue to the forefront and support policies that end discrimination and lead to equity.