Black women hold less in wealth than any other race-gender group in the US. At least three factors likely contribute to this persistent inequity. First, Black Americans and women have been excluded from investments such as homeownership through lack of access to financial services. Second, Black Americans and women face contemporary discrimination in the labor, housing, and financial markets, meaning that Black women are paid less, their homes are worth less, and they receive more loan rejections than any other group. Finally, historical and contemporary experiences with structural barriers and structural opportunities influence how people interact with their finances, which can affect behaviors such as risk aversion, which is higher among Black Americans.

In this brief, Zawadi Rucks-Ahidiana and Ola Kalu build on these lessons from prior studies of wealth inequality to (1) further understand wealth gaps by looking at race-gender wealth gaps and (2) understand how historic experiences of structural inequality, contemporary experiences of structural inequality, and the cultural effects of both on decisionmaking interplay to produce race-gender wealth gaps. The authors examine the 2019 Survey of Consumer Finances to conduct a nationally representative analysis of net worth, total assets, and total debts. 

Rucks-Ahidiana and Kalu find that Black women hold the least in net worth, assets, and debts compared with white men and women, Latinx men and women, and Black men. The authors further dissect each gap to contextualize how intergenerational, cultural, and structural factors impact the wealth of Black women. Structural factors drive lower wealth holdings across network, asset, and debt holdings. Across the regression models and decomposition analysis, Black women’s wealth holdings are impacted by race-gender differences in income, owning a business, having a managerial job, returns to financial ideals that increase assets and net worth for other groups, returns to college education, and returns to marriage.

Based on these findings, the authors identify five policy areas that could help improve Black women’s wealth holdings:

1. Addressing pay equity
2. Eliminating racial and gendered discrimination
3. Offering Black women more business loan opportunities
4. Reducing and eliminating student debt
5. Addressing racial and gendered disparities in home appraisals