It is widely known that there is a vast wealth gap between Black Americans and their white counterparts. According to the Economic Policy Institute, it’s only getting worse as it has grown 33 percent from 2000 to 2019 and Black families will need over 200 years to catch up. Here are 5 takeaways for Black America from a new Federal Reserve study on the wealth gap.

1. The typical Black family has 8 times less wealth than the typical white family.

White families are three times more likely thank Black families to pass down inheritances and assets to their descendants, thus setting them up for financial stability.

According to the Federal Reserve’s study 29.9 percent of white families receive an inheritance compared to 10.1 percent of Black families.

The typical White family has 8x the wealth of the typical Black family.

Why?

A big reason is inheritance. White families are 3x more like to pass on money & assets to their kids, giving them a major boost. https://t.co/zAvnVYfQY2 via @rachsieg pic.twitter.com/5YNLGsB36Z

— Heather Long (@byHeatherLong) September 28, 2020

2. The average young Black family has no wealth compared to the average young white family.

In families with members ages 35 and under, white people have between $11,900 and $24,800 more in median wealth than Black, Hispanic, or other families, the report states.

There is also a gap in the expectation of receiving an inheritance, with only 6 percent of Black families expecting one compared to 17 percent of white families.

3. Black families are less likely to own their homes than white families, which is a wealth building tool. This contributes widely to the wealth gap.

Home ownership is one of the most common ways to begin building wealth. Due to discriminatory practices like redlining, significantly less Black families own homes than white families.

According to the Federal Reserve’s Study, when it comes to young families “about 46 percent of White families own their home, compared to just 17 percent of Black families.” 

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4. Black families are less likely to have retirement accounts than white families, thus increasing the wealth gap.

Most people cannot, or choose not, to work full-time forever. Hence, the wisdom of having a retirement fund, specifically as some experts project social security may depleted by the time the next generation becomes seniors.

When it comes to retirement planning, Black families are also less likely than their white counterparts to be prepared. “65 percent of White families have at least one retirement account, compared to 44 percent of Black families,” the study states.

5. Black families have four-times less emergency savings than white families.

Life happens. And because of this financial expert often suggest having a hefty emergency savings fund to help families through unforeseen circumstances. Like the aforementioned areas, Black families also have significantly less emergency savings.

According to the Federal Reserve’s study, the typical Black or Hispanic family has $2,000 or less in liquid savings, the typical White family has more than four times that amount.”