Did You Know White Families AreTwice As Likely To Be Millionaires Than Last Generation?
By Ryan Velez
Federal reserve data is showing that white millionaires have doubled in the last quarter-century, according to the Washington Post, posing the question as to where the wealth is coming from and how other groups can get a piece.
Fifteen percent of white families reported being millionaires, compared with 7 percent in the Fed's 1992 Survey of Consumer Finances. This is one small part of a larger trend of a widening economic gap, with the top 1% of households holding 24% of income.
“We have growing wealth disparities among whites as well, but the white group is so much further ahead that the class of elite Blacks is nowhere near the class of elite whites,” said Darrick Hamilton, an economist at the New School in New York.
This trend shows no signs of stopping, either. The average white household, worth about $930,000 in 2016, will accumulate a net worth of more than $1 million by the time the next triennial survey comes out in 2020, Hamilton said. Several key indicators of wealth are dominated by whites, including homeownership and equity, investments, and inheritance. It is believed that a major component of the growth in white wealth is coming from the doubling of financial assets, including stocks and bonds, as well as pensions and retirement accounts. Equity in homes and nonfinancial assets also saw growth, but not to this degree.
When you look at homeownership, it becomes clear how racial politics leaks into finances. “If you are a black homeowner, you are more likely to have a lower value on your home because of neighborhood segregation,” said Valerie Wilson, director of the Economic Policy Institute’s program on race, ethnicity, and the economy. “Blacks couldn’t purchase in white communities where values were rising faster.” Also notable is the fact that white families are more likely to “trade up” to another house later on, while more black families either stick with the home they have or lose it.
“The racial disparities in wealth, which is the paramount indicator of economic opportunity, security and overall well being, remain stark,” Hamilton said. “And if the Trump tax plan, which includes the elimination of the estate tax, is made into law, it will only get even larger.”