Why Wealth Building For Black And Brown Students Matters – Forbes
African American student working online to enhance investment skills.
Within the United States, there are huge wealth gaps along racial lines. According to The Brookings Institution, the median net worth of a white family is $188,200, nearly ten times greater than that of a Black family. The median Hispanic family’s net worth is $14,000. Although there are many historic examples of Black and Brown families working to establish wealth, systemic racism and other discriminatory practices at the local and national level have worked against the building of large-scale assets.
Building wealth and understanding how to invest and manage money is an essential skill that is often shared with children in wealthy families. To build wealth in low and middle-income communities of color, it is essential that young people are taught these skills and given opportunities to use them. With this idea in mind, Prudential Financial, in partnership with the Student Freedom Initiative (SFI) and Stackwell, is launching the Student Investment Program (SIP) to help build generational wealth for Gen Z students of color. The program strives to “address the racial wealth gap across marginalized communities, confront subsequent barriers to financial wellness for future leaders and advance Prudential’s core vision of helping better serve those disproportionally impacted by historical economic and social inequities.”
Sarah Keh, Vice President of Inclusive Solutions at Prudential.
Photo Credit: Prudential
According to Sarah Keh, Vice President of Inclusive Solutions at Prudential, “The racial wealth gap continues to grow with each generation. One of the primary ways people build wealth is through investments, but historically, Black Americans are less likely than White Americans to invest in the stock market.” She added, “SIP will build investor acumen and confidence at a young age, which will lead to a better understanding and trust in the financial markets for the long term. With Prudential’s support, SIP will expand access to and utilization of this critical wealth-building pathway for Historically Black Colleges and Universities (HBCUs) and Minority Serving Institution (MSI) students.”
The multi-year partnership will also include grants totaling $500,000 to students attending 43 HBCUs and other MSIs within the SFI network. These grants will be distributed to participating students’ investment accounts over a 12-month period to encourage participants to sustain investment commitments, while normalizing positive wealth building behaviors.
Keh believes the SIP program is an important step in the company’s larger goal of diversifying the next generation of leaders, noting that “increasing representation in financial markets is essential to closing the racial wealth gap.” Prudential’s vision is to expand access to investing, insurance, and retirement security. The company will …….