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Black Households’ Net Worth $2,200; Whites’ $97,000

The reality of a post-racial America appears to be light-years away. Blacks continue to outnumber whites in the prison systems; black students are dropping out of high schools at alarming rates; and the financial gap between black households and white households is at an all-time high.

According to a report conducted by the Economic Policy Institute, 40 percent of black households held a zero or negative net worth during the recession (2007-2009). The study also pointed out the discrepancy of wealth between black and white households. The median net worth of black households was $2,200 and the median wealth for white households was $97,000.

There are several factors that have led to an unequal distribution of wealth in the black community. Due to overt racism during the 20th century, very few blacks were given the opportunity to build and pass along generational wealth. As a result, many blacks are often raised in households that don’t teach the importance of financial literacy.

The study also pointed out that half of all U.S. households owned no stocks at all — either directly or indirectly through mutual or retirement funds.

Homes were often the greatest asset for most black families, however; the housing bust caused the value of homes to drop 50 percent. And with the rising number of home foreclosures, the banks now own more stock in homes than citizens. The number of foreclosures will also increase now that House Republicans recently voted to do away with President Obama’s anti-foreclosure program.

Net worth can be calculated by subtracting the sum of all liabilities (mortgages, credit card debt, car loans, outstanding medical bills and student loan debt), from the sum of all assets (real estate, stock holdings, bank account balances, retirement funds and accounts).

amir shaw

Economic Policy Institute Study



27 Comments

  1. Uncle Chuck on April 1, 2011 at 10:04 pm

    Assets put money in your pocket
    Liablities take money out of your pocket

    Is your home really an asset?

  2. Finance1 on April 2, 2011 at 6:05 am

    Your home becomes an asset once you own it

    • Dswintonian on December 24, 2011 at 8:26 pm

      Assets put money in your pocket.  And no you never own it..you pay the mortgage off but your property taxes not being payed means the local government will seize your home.  A home is a NON INCOME GENERATING asset.  It only benfits you when and if the market value exceeds your purchase price and you extract that gain.  Until then it’s unrealized gains. 

  3. Finance1 on April 2, 2011 at 6:05 am

    Your home becomes an asset once you own it

  4. Trublkgd1 on April 2, 2011 at 9:28 pm

    It’s strange that jews pray to their hebrew god and are on top of the economical heap. Black Folks were tricked into praying to that same god by ignorant or devious black preachers and those same black folks are at the bottom of the economical ladder. Of course there must be a better alternative then praying to a white or seemingly white man that the “nation of islam” take as a god.
    see http://www.pyramidoftruth.com

  5. Whitey on April 3, 2011 at 4:55 am

    I don’t believe any of the numbers in this article. This is made up. The housing bust did not cause home values to drop 50%.

    • Dswintonian on December 24, 2011 at 8:37 pm

      Whitey-you obviously are obtuse (probably a black female) who knows little if not nothing baout finance.  Yes all homes loast 20-50% of their values thus decreasing net worth.  The article failed to state that 401k, stocks and mutual funds value also declined at the same rate.  The reality is, even when time wher good, blacks still saved, invested and had a net worth at a much lower rate than white, even asians have higher net worht than blacks.  We don’t save, we spend on depreciating things, we don’t read about investing understand the short and long term value and ultimately we spend (retail therapy) all our working earnings which is taxed at a higher rate.  We don’t own *hit of value..but everything of lw.or no value. 

  6. Open2Change on April 3, 2011 at 9:29 pm

    That’s a pretty general statement considering America is a melting pot of all races and the recession has hit everyone. So if this is the case what is the net worth of a bi-racial family’s home? Was that factored into this equation? If the median net worth of black households is $2,200 then someone forgot to add in Oprah, Russell Simmons, Jay Z, the estates of countless black legends in stage, screen, politics, and entertainment, Shaquille O’Neal, his wife Shaunie (cause she’s freakin’ paid!), every black NBA’er and footballer, Raven Symone, Condoleeza Rice, and other wealthy or well to do Black Americans. They also didn’t add in the middle class wealth of those are on average making it happen perhaps not with the extra sheen to show off but still are making it happen for their families nonetheless.
    On the flip side the perpetrators of this alleged report forgot to add in the entire middle and southern parts of the US. Surely a few hundred thousand of the trailerpark and rental homes occupied by poverty stricken whites may have decreased that $97,000.
    Regardless of any propaganda to keep us mentally enslaved and believing we’re never doing better or never going to get any better black people ARE doing better financially these days than they have ever done. The choice now lies with us as a people to rise to the occasion and continue to work hard for what we want. Sqawking at having to work harder doesn’t change the fact that we have to. It’s the world we live in. We were built to work harder and we still come out on top. When public schools close ALL our children are affected. When housing costs skyrocket and mortgages are foreclosed we ALL suffer. White children are not only dropping out of school but they are now shooting and killing each other IN school. We’ve all got problems and triumphs. Overt racism in the 20th century is no longer an excuse to any race especially since there are more races than black or white in America. The Black vs. White argument has validity to some extent in the 20th century but has now expanded to included Pakistani, Iranians, Chinese, Mexicans, and other folks unjustly discriminated against due to ignorance and hardheadedness. These type of articles seem almost ‘outdated’ nowadays. A report by some unheard of agency does not constitute my state of economical emergency nor dictate my social belief. RISE.

    • Noblepoets on April 17, 2011 at 6:51 pm

      I agree my man well said. I worked for a polling firm which have done hundred s of thousands. Of polls that were totall inaccurate. Always do your research on these research firms before inhaling half truths.

    • MystiKasT on April 7, 2014 at 9:45 am

      Median is different than average, maybe you should understand basic arithmetic before you spout off

  7. T_esq on April 3, 2011 at 11:18 pm

    How Absurd! I am sick and tired of these types of statistics. If this is truly the case (I highly doubt it) what’s the purpose of this information? Everyone knows the scale is NOT balanced and does not need any more reminders. How about statistic that showcase the positive side of Black families and I don’t mean Black celebrities!

    • juanita on April 3, 2011 at 11:32 pm

      do u no how we can get to the source of this information?

    • MystiKasT on April 7, 2014 at 9:45 am

      blacks are a real problem

      • Guest on November 24, 2015 at 12:49 pm

        And we’ll continue to be. Get over it.

  8. 4peace2b on April 4, 2011 at 2:53 am

    Reparations now! They are way past do…

    • jim on April 5, 2011 at 9:28 pm

      Really?
      For what?

    • James on June 19, 2012 at 12:10 pm

      The reason you need reparations is because you can’t spell “due”

    • MystiKasT on April 7, 2014 at 9:46 am

      you got to live in the US instead of the shit hole africa — that should be reperation eough

      • Guest on November 24, 2015 at 12:50 pm

        “you got to live in the US instead of the shit hole africa — that should be reperation eough”–Not even close, since that shit hole Africa needs to get theirs too.

  9. Jim on April 5, 2011 at 3:13 am

    This isn’t about generational wealth it is about hard work, perseverance, and the family unit. As I made my way through my work life I didn’t have any money from parents. My Father died when I was in the Army, trying to fund my own college education. He was 30K in debt at the time. I helped my parents pay the bills and I know many people who have done the same. Yes there is racism, BTW it tends to go both ways. I’m sure there are many hard working, educated people in the black community that are highly offended by these comments about distribution of wealth. There are two types of people in this world. Givers and takers. It all depends on which side you choose to be on. I could go on but my fingers are out of breath.

  10. Jim on April 5, 2011 at 3:13 am

    This isn’t about generational wealth it is about hard work, perseverance, and the family unit. As I made my way through my work life I didn’t have any money from parents. My Father died when I was in the Army, trying to fund my own college education. He was 30K in debt at the time. I helped my parents pay the bills and I know many people who have done the same. Yes there is racism, BTW it tends to go both ways. I’m sure there are many hard working, educated people in the black community that are highly offended by these comments about distribution of wealth. There are two types of people in this world. Givers and takers. It all depends on which side you choose to be on. I could go on but my fingers are out of breath.

  11. jim on April 5, 2011 at 3:32 am

    One more thing and I think it is the leading factor which has led to a disparity of wealth. This was not even touched on the article. Very poor reporting and investigating. Sounds like an amateur journalist that latches on to an unbelievable stat which just fuels the fire of racism. Anyway, the thing that was missing is the fact that since the 1960’s and the “war on poverty” started by President Johnson, the federal government has sought to enslave the poorest of the American people by turning them into dependents of the state. Welfare, food stamps, medicare, medicaid, entitlement after entitlement has decayed and destroyed the black culture in my opinion. If we would stop these programs you would see such a surge in individual responsibility and prosperity in the minority communities. Truly, these programs did more to strip people of their personal integrity and self-worth tan anything else in history. What have they left us with. Over 50% of all abortions performed are of black children even though they are only 17% of the population. That is the true crime. And to top it off, black leaders like Jessie Jackson and Al Sharpton and other leading Democrats fight for abortion rights rather than the lives of these babies. They could grow up to create good, to heal, invent, lead. Instead they are thrown out with the trash. When are the leaders in the black community going to stand up against this travesty and DO THE RIGHT THING! The democrat leadership is laughing all the way to the voting booth. You are like junkies waiting for the next fix from the govt gravy train. Sorry, I guess I am a white guy that cares, After all my ancestors fought for freedom from slavery. They did what was right and were willing to die for that cause.

    • CommonSense on April 21, 2012 at 12:49 pm

      Jim, you are totally incorrect. In fact, the things you mention have increase the wealth of the poor and many Blacks who have been victims of this unfair world we call America.

  12. Sharon Salaam on April 15, 2011 at 1:31 am

    I agree we have more wealthy Americans of African descent than ever in our history in the US. We just have to collaborate and be more conscious of what we as a nation of people need. We need to produce more than we consume and stop making everybody rich but us. Support our own homogenous efforts, such as better schools for our children with better curriculums and teachers, parents, clergy, and politians that have more on their minds than pimping people.

  13. CommonSense on April 21, 2012 at 12:51 pm

    This article may be incomplete, but it isn’t incorrect.

  14. MystiKasT on April 7, 2014 at 9:43 am

    No surprise, blacks often cannot hold jobs and live off of welfaare

    • Guest on November 24, 2015 at 12:52 pm

      As long as you make sure you keep your job and pay taxes. Thanks!