African-Americans are starting to close the wealth gap, in large part due to home ownership, according to analysis of
Between 1998 and 2001, the median net wealth of African-American households rose from 9.1% to 22.1% compared to that of the average U.S. household. During that period, average net wealth in African-American households went from $5,919 to $19,010, a $13,091 or 221% increase. Meanwhile, wealth in the average American household went from $64,788 to $86,100, a $21,312 or 32.9% increase.
During those three years, many African-Americans have changed their attitudes about saving, shifting to longer investing time horizons. Also, 42% of black households were saving regularly in 2001, compared with 41% for the entire population.
Even so, large wealth gaps persist, since 41.1% of black households had less than $10,000 in net wealth in 2001, compared with only 22.9% for the total population. Only .08% of black households have $1 million or more in wealth, while 7.0% of total U.S. households have that much.
Emergency savings remains the leading primary motivation for savings among the 3,300 African-Americans registered with Black America Saves, a program available through BET.com. Twenty-six percent are saving for an emergency fund, with 22% aiming at home ownership, 21% at debt repayment, and only 12% saving for retirement.
