Retirement In Black And White

We all need to help close the racial wealth gap in America

astounding. For instance, McDonald’s implemented an automatic enrollment program for restaurant managers and enrolled them at 1% of their pay. What’s more, as an incentive the company gave restaurant managers a one-time 1% raise to offset what was being taken out of their paychecks. Along with other plan changes, McDonald’s produced significant results. In two-and-a-half years the percentage of African American restaurant managers participating in its 401(k) plan surged from 50% to 95%. Additionally, their aggregate account balances increased from $12.6 million to $17.8 million, a jump of almost 42%. Moreover, investing by every demographic increased.

Beyond taking responsibility for our own financial security, each of us can play an important role in promoting financial literacy. If you’re a business owner or leader in your company, I encourage you to ask your chief financial officers and HR departments to examine your retirement programs by race and determine how you can help increase participation. Together, I know we can make a difference.

Mellody Hobson is the president of Ariel Capital Management L.L.C./Ariel Mutual Funds in Chicago. She is also a regular financial contributor to ABC’s Good Morning America.

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