Affluent black Americans are more apt to feel responsible for supporting elderly parents or other family members financially, according to a study by Northern Trust.

Fifty-two percent of affluent African Americans are more likely to make charitable donations to educational organizations than non-blacks (39%), according to the study. Blacks also outpace supporting religious groups (48%), compared with 44% of non-blacks, and human services organizations (47%) than non-blacks (38%). They are also more likely to make charitable donations directly, rather than setting up charitable trusts, making their financial planning and advisory needs a little different from other groups, according to officials at the financial services company.

Northern Trust released the study, Wealth in Black America: 2010 Study of Financial Attitudes and Preferences of Affluent Blacks, after a polling 361 affluent blacks and 256 affluent non-blacks last summer. This is the second such study, after one conducted in 2008.

Advisors who want to forge a tighter bond with affluent black American clients—or potential ones—should understand some of these cultural differences, say Northern Trust officials. 

One major difference between blacks and other Americans is the strong cultural bent toward helping out family members, said Mark Welch, director of global diversity and inclusion at Northern Trust. The survey found this to be true among 71% of black respondents. According to the study, 52% of affluent blacks feel responsible for supporting adult family members, significantly more than 36% of non-blacks. Fifty-two percent of affluent blacks currently provide financial support to their parents.

“This is compounded by first-generation wealth,” Welch said. “That client might have been the first to go to college, to start a business and to become affluent. There is a greater pull to be an example in family, the community and ensure others can be as successful as you.” A living trust, which sets forth a plan for how a client’s assets will be used during his or her life and after death, can help address those needs, Welch said.

Other findings that might present some work for advisors: the use of charitable trusts is down to 25%, from 32%; as well as marital trusts, 23% compared with 30%. The use of wills is up, though, as 57% of respondents said they had a will, compared with 52% in 2008. Affluent blacks tend to donate more directly to organizations, Welch said. It gives them the opportunity to do more direct due diligence as to how the funds are being used.

Affluent blacks also have a couple of important experiences in common with other Americans, which can change their financial picture. The first is the hardships of the so-called boomerang generation, says Welch. That set of young people went off to college, but is returning home for several years because of the bleak employment and economic climate. While the parents of those youngsters want to help, they also want to know how they can get them to take on more responsibility, so they can lead sustainable lives of their own. Northern Trust also found that affluent blacks provided more financial support to younger adult family members, such as children, nephews and nieces, than in 2008.

Also, 58% of wealthy blacks have not worked with a financial advisor in the past five years to establish an estate plan, and 54% has not set up a personal trust, although respondents did express an interest in estate planning. Welch said this is a similar finding among non-blacks, although the company has sorted out why affluent clients sometimes have this disconnect.

One major finding changed dramatically since the last iteration of the study, Welch said. While blacks were still concerned about rising health care costs and tax rates, that concern dropped by 15% since the last study.

“That is significant to us,” Welch said. “Their concerns have been lessened to a degree. People feel generally optimistic about the economy and they think things are turning around.”

Yet there is still work for advisors to do, according to the study. Fifty-one percent of affluent Blacks believe the cost of healthcare will become a drain on their wealth during retirement, followed by increased taxes (47%).

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