The Average Black Family Would need 228 Years to Build the Wealth of the Average White Family

The problem grows

Starting with one factor, income, it's clear to see how the gap grew. Income was 50 percent higher in 2011 for whites than it was for blacks and Latinos, but the median household wealth for white households was around 16 times greater. How can that be? More earnings equates to more savings, and greater opportunities to build wealth. In addition, disasters like the real estate crash have a much greater affect on blacks than on whites.

What about government programs?

The study shined a not-so-flattering light on government programs that are supposed to help build wealth. Here are some of the highlights:

• Government spending on wealth-building has more than tripled since 1994 but mostly helps people who already have wealth
• 77 percent of the home mortgage tax deduction benefits households with annual incomes between $75,000 and $500,000
• Two-thirds of all public subsidies for retirement savings go to people whose incomes are in the top 20 percent

Bottom line

Unless things change, the study predicts that in the next 30 years, the average white family’s net worth will grow by $18,000 per year, but growth for black and Hispanic households will be only $750 and $2,250 per year.




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