Why your white coworker will probably retire earlier than you
Comments(12) If you’re black, look at the person next to you in the office. If she’s white, she’s probably got a 401(k) 50 percent bigger than yours, according to the latest Ariel/Schwab Black Investor Survey.
Time to step your game up, homie.
There is good news in the survey, which polled about 500 African-Americans and 500 whites who make at least $50,000 a year. 90 percent of both groups said they’re already enrolled in their 401(k)s. But we on average kick in about $169 a month, while whites put in $249. That means the whites have media retirement savings of $114,000 compared with only $53,000 for African-Americans.
This is sobering, especially considering how many young, black professionals have asked me in the past two weeks whether they should be pulling out of their 401(k)s.
How much are you putting into your retirement every month, and do you expect to be able to retire comfortably at the age you want to?
Not sure what the national comparison is on annual income, but I’m pretty sure blacks as a population make less. Therefore I’d be interested in seeing that comparison shown as median 401K contribution % of income by race.
B: You make a good point, except that in this survey, only those making above $50,000 a year were interviewed, thereby reducing the chances for results skewed by income disparities between blacks and whites.
Unfortunately, blacks often place the priority on consumables/trappings of wealth rather than actually building wealth. Until last year I drove a ‘95 Accord despite being able to afford to get a newer car. My car was clean and well-kept. Invariably, black people would ask me why I was driving such an old car or when I was going to get a new one. Whites never asked because they already knew the answer. It was paid for and that my money was put to better use by investing.
This has been the case for a while. Don’t they do this survey every year?
With my next check, I’ll fully clear out a bill, which means I’ll have $200 a month freed up. If this happened three or four months ago, I might have used only about $75 of that to add to savings, but it’s going to be at least $150 of it now.
I reached the $50K mark this year. 20% or about $770 per month is put into my 401k. I also have a Roth IRA that I maxed out this year. Hopefully I’ll keep doing that, however I’m not sure I’ll have “enough” for retirement.
I suspect the higher rate of marriage in the white community plays a part. There aren’t enough black people to consume everything so white people are also using goods and services.
When two working adults combine living expenses its easier to max out retirement accounts and still have discrestionary income.
It’s funny that blacks spend on average half as much as whites on their 401K so therefore it makes sense that they have half as much savings as whites do. QUIT SPENDING MONEY ON ….YOU DON’T NEED LIKE FANCY CARS AND RIMS AND DIAMONDS THAT YOU CAN’T AFFORD. Then maybe you will have more money to retire on. Quit blaming your inequalities on the white race. It’s been 50 years since the civil rights movement. Time to start making something of your lives instead of complaining and waiting for government handouts.
I contribute 6% of my salary. Why? because that is the maximum amount that my company will match. I put another 1% in to my Roth IRA and another 1% in to my emergency savings account. Could I save more? Probably. BUT I’m trying to balance saving for the future and paying off current debt now. As more debt gets paid off I will contribute more to long-term savings.
But guess who is my financial advisor? An older white man (father of an ex). His race doesn’t matter, at least not to me, BUT he reached out to me and has helped me to learn so much about my money and investing and debt management. Things that I’m sorry to say my own family could not teach me or advise me on. It’s not their fault, money management is something that is not discussed or taught and it will be my generation who deals with money differently when we talk to our kids.
Money management is an ongoing thing…that’s what a lot of people don’t understand. My advisor sends me emails every week about various money topics. We talk all the time because he helps me to stay on track with my financial goals. The motivation, encouragement and knowledge he offers to me is HUGE. And is he benefitting in any way, nope, just the personal satisfaction that he is helping a younger person to be more financially prepared for the future.
All of us that are saving as much as possible are going to be shocked to learn that the democraps are planning on seizing our 401k accounts or any other retirement account so they can “spread the wealth” with those that spent to their hearts desire, well beyond their means. They feel they will be better stewards of those accounts! It is NOT going to be fun having a socialist government because they will change far more than many have imagined. They are talking about “rewriting” our constitution…the one thing that has kept our country from having dictators like Sadam, or Hitler, or any other horrible creature that has killed millions of their own citizens… AND they are still trying to get a “supermajority” so that nobody can oppose them when they steal our retirement savings! PLUS, they will be able to replace supreme court judges with those that will legislate from the bench rather than upholding the law of our land. It will, in fact, no longer BE our land! Then the “spreading the wealth” will help eliminate global poverty. Yea…we will ALL get to be poor…except for the political elite and the powerful rich that will keep their wealth. Two classes….hmmmm….how many voted for this????
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