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Title: Defining Personal Financial Assets in the African American Community

Citation Type: Miscellaneous

Publication Year: 2016

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Abstract: In September of 2015, the Star Tribune published an article illustrating the large income disparity that Minnesota faces among African Americans and their white counterparts. The article sites the American Community Survey (ACS), a survey conducted by the U.S. Census Bureau. The ACS determined that, the median income for black householdsfell [by] 14 percent (Reinan, Webster 2015). This is a decrease of $4,500 from $31,500 to $27,000. In comparison, the overall state median household income is $61,400 and that of white Minnesotans is roughly $64,800 while Asian and Hispanics earn $68,000 and $42,000 respectively. It is very clear that income is a great disparity in Minnesota; however shifting the focus to wealth it is more likely that there is an even greater disparity. How much wealth an individual holds is not a direct effect of how much income that individual attains. The same can be argued for a multitude of factors, of which will be discussed later in this report. Income is a snap shot of the amount of money that one accumulates in a certain amount of time. Wealth on the other hand is the net worth of an individual. Wealth indicates the economic opportunity, security and the overall well being an individual or household possesses (Darity, Hamilton 2015). When studying wealth, it is necessary to take into account all assets along with all debt. This wealth influences the quality and level of education, health care, access to proper housing and the resources available. Having low wealth can have detrimental consequences when unexpected life situations occur, such as loosing a job, a health crisis or as simple as incurring further debt. A household that holds a positive net wealth, with liquid assets is more likely to bear any one of these life circumstances occurring. Research shows that the wealth gap between African Americans and White Americans is substantially wide. It is wider than any income gap. Wealth is one the largest disparities faced by African Americans in the United States. As noted previously, the drop in income level has exacerbated the disparity in income in Minnesota. If the income disparity is this large then assuming the gap in wealth is substantially higher in the state is not unreasonable.

Url: http://conservancy.umn.edu/bitstream/handle/11299/181011/KNCBR 1410.pdf?sequence=1&isAllowed=y

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Authors: Karongo, Lawrence

Publisher: University of Minnesota

Data Collections: IPUMS USA

Topics: Other, Race and Ethnicity

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