Financial Literacy Alone Won’t Close the Wealth Divide – Morningstar
Sonya Dreizler: Hi, my name is Sonya Dreizler. I’m joined today by Phuong Luong, and we are here to talk about building generational wealth for all families.
Phuong Luong: Thank you. Thank you. So great to talk to you about this important topic. Yeah, I’m excited to be here.
Dreizler: Well, let’s just jump right in. We have likely all heard the term racial wealth gap. What does that mean? Where do we stand? And how did we get here?
Luong: Yeah. So, big questions, but it’s important to cover because not everybody knows what the racial wealth gap means or what it’s referring to. And actually, to start us off, I’d like to rephrase that term. I don’t really like to use the term racial wealth gap. I’d rather say racial wealth divide. And it’s not just something I’ve created or stated. It’s because when we think about gaps, we think about a small distance that we could just jump over. But actually, when we say divide, that points to the real issues. There are true barriers—structural, interpersonal, and wealth barriers—that exist between the level of wealth that certain communities in the United States have versus other communities. And when I say communities, I’m talking about in terms of gender, race, ethnicity, there are definite wealth divides here, not just in terms of the numbers, but also in terms of the opportunities and blocks that are in place for certain communities over others to build or to lose wealth.
So, how did we get here? It’s a long history, super long history, starting from the founding of this country, land theft, slavery, all the way to blocking who can start a business, who has the ability to go to school for a fair cost, who is allowed to purchase a home in a certain area, and I’m referring to redlining, for example. We can talk about all of these things, but there are so many resources available online throughout history that so many financial advisors don’t learn about in our studies to become financial services professionals. And that’s something that happened to me as well. I was actually a teacher in a past career. And then, I worked at nonprofits, working with people living in public housing, before I became a certified financial planner, and in grad school, my K-12 schooling for my own education before I went to college, even …….