The colorof wealthboston
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The Color of Wealth Boston study focused on estimates for Black Americans, Caribbean Blacks, Cape Verdeans, Puerto Ricans, and Dominicans in the Boston Metropolitan Statistical Area. The study revealed striking disparities. For example, there were extremely low homeownership rates among communities of color. With respect to debt, several key findings emerged from the study. Because households from communities of color often hold higher-cost debt, have higher debt-to-income ratios, and are more likely to be denied credit, their ability to build wealth is crippled and contributes to lower asset ownership and lower asset values when compared with White households.
Wealth matters for building an equitable and prosperous Boston Metropolitan Statistical Area region. Despite the importance of wealth for economic security and mobility, wealth is rarely the target of policy solutions. And that needs to change.
How unequal is wealth in Boston?
Assets: A major driver of wealth inequality in Boston
Assets are key to understanding not only peoples’ current wealth, but their ability to hold onto and grow their resources. Someone who has a large store of liquid assets is better able to weather financial shocks and emergencies. People who own their homes and own stock are better able to grow their wealth.
Significant racial disparities exist when considering total assets, liquid assets, stock ownership and homeownership. White families in Boston have higher rates of asset ownership and median asset values across the board.
Assets and financial well-being: Cape Verdean
- Select a race/ethnicity
Boston
Median
Total assets
Median
Liquid assets
$0.2K
Percent with
Liquid assets
74%
Percent who
Own stock
6%
Percent who
Own their homes
29%
Debts: A look at inequality
Debt can be an important barrier to a family’s ability to build wealth. For instance, higher education can lead to both higher earnings and burdensome student loan debt.
In Boston, higher than average percentages of US Black families, Caribbean Black, and Other Hispanic families hold student loan, medical and unsecured debt.
Debts: Cape Verdean
- Select a race/ethnicity
Boston
Percent with
Student loans
26%
Percent with
Medical debt
2%
Percent with
Unsecured debt
44%
Financial institutions and services
Low rates of being banked indicate that many in these populations are living paycheck to paycheck - unable to save enough money in their accounts to meet the minimum banking requirements. However prudent it may seem to remain unbanked and thus pay high transaction fees, these circumstances make it difficult to accumulate savings and begin to earn interest on owned funds. White, Caribbean Black, Black American and Cape Verdean families had some of the highest rates of owning a checking account.
Financial Services, Access and Quality: Cape Verdean
- Select a race/ethnicity
Boston
Percent with
Bank accounts
74%
Percent with
Payday lending usage
1%
About and credits
About the project
The Color of Wealth Boston study focused on estimates for Black Americans, Caribbean Blacks, Cape Verdeans, Puerto Ricans, and Dominicans in the Boston Metropolitan Statistical Area. The study revealed disparities in both financial and tangible assets that were striking. For example, there were extremely low homeownership rates among communities of color. With respect to debt, several key findings emerged from the study. Because households from communities of color often have higher-cost debt, have higher debt-to-income ratios, and are more likely to be denied credit, their ability to build assets is crippled and contributes to lower asset ownership and lower asset values when compared with White households.
Methodology & data collection
The Color of Wealth Boston survey was conducted in the Boston Metropolitan Statistical Area between 2013 and 2014. Various sampling techniques were used to locate and identify an ethnically plural sample consisting of specifically defined ethnic groups. The techniques included the following: directory-listed landline samples targeted to census tracts where specific ethnic groups were known to reside; cell phone random digit dialing samples drawn from rate centers that covered the targeted ethnic group zip codes; samples drawn from targeted zip codes based on billing address; and the use of surname-based lists targeting specific national origin groups. In the Boston MSA, 403 surveys were completed.
Credits & thanks
This project was made possible by the generous support of the Ford Foundation’s Building Economic Security Over a Lifetime (BESOL) initiative and the Federal Reserve Bank of Boston. Additionally, we would like to thank the Research Network on Racial and Ethnic Inequality at the Duke Consortium on Social Equity at Duke University. Tom M. Guterbock at the University of Virginia directed the survey collection. Graphicacy worked with the Institute team to visualize the data from the Color of Wealth Boston study.