A new study by Dr. Fenaba Addo, a Health and Society Scholar in the University of Wisconsin School of Medicine and Public Health, shows that a quarter of African-American women had no assets or a negative net worth when they reached ages 51 to 61. Lower marriage rates and a history of martial disruption explain some of the difference, the study says.
“It’s not a happy message, but policy makers should be aware that this large generation of black women is approaching retirement with many lacking the assets to support themselves or their families,” says Addo, whose study is being published in the April issue of The Journal of Marriage and Family.
African-American women ages 51 to 61 had accumulated a median net worth of $33,349, compared with $182,897 for white women the same age. When home value was excluded, those numbers fell to $5,366 for African-American women and $61,761 for white women.
Along with co-author Dr. Daniel Lichter of Cornell University, Addo looked at the wealth of 7,026 women at ages 51 to 61 who responded to the national Health and Retirement Study (HRS). Three age cohorts including early Baby Boomers, war babies born during World War II and an older group born during the 1930s were surveyed during 2004, 1998 and 1992 versions of the survey.
These women, says Addo, “were on the front line of America’s family revolution over the past half century.” When the 20th century began, African-American women were more likely to be married than their white counterparts. By the 1950s, the lines crossed.
“The marriage rates dropped off precipitously for African-American women in the 1950s and 1960s,” says Addo. The study found that when these women reached their 50s, 37 percent of African-American women were married compared with 72 percent of white women. Addo calculated that this disparity accounted for about eight to 10 percent of the wealth gap between races.
“Marriage is not a cure-all, because white women benefit financially from marriage more than African-American women,” Addo says. Housing value added another disparity: the homes owned by white women had a mean value of $130,000, compared with a value of $46,000 for homes owned by African-American women.
And because the last survey was before the Great Recession, Addo says the accumulated wealth for all women is likely lower due to the collapse of housing prices, adding, “A lot of this wealth was wiped away by the recession.”
“These women are going to have to work well into old age,” says Addo, “and they will be especially reliant on programs such as Social Security and Medicare, because they have few other assets.”
Addo’s research as a Health and Society Scholar is supported by the Robert Wood Johnson Foundation. A link to her paper is available here.
University of Wisconsin School of Medicine and Public Health