</a>Middle-class African Americans are more likely than whites to have cut back on saving and investing in order to make it through the recession, according to the <a href="http://www.arielinvestments.com/images/stories/landing_pages/Black_Investor/2010bispressrelease.pdf" target="_blank"><strong>2010 Ariel Black Investor Survey</strong></a>. The data is not unexpected since the <a href="http://www.blackenterprise.com/business/2010/07/02/unemployment-rate-for-blacks-inched-lower-in-jun/" target="_blank"><strong>unemployment rate for African Americans (15.4%)</strong></a> continues to track higher than the overall jobless rate for all Americans (9.5%). <strong>“In times of economic hardship, people have to make difficult decisions,” said Mellody Hobson, Ariel president and columnist for Black Enterprise magazine. “Unfortunately, the resulting trade-offs mean <a href="http://www.blackenterprise.com/business/2010/05/18/african-american-wealth-gap-quadruples/" target="_blank">many in our community are slipping even further behind</a>.”</strong>
</a> In the survey of 501 blacks and 505 whites with household incomes of at least $50,000, nearly half of all blacks (compared to 31% of whites) dipped into savings to make ends meet in the last two years. Additionally, 27% of Blacks who participate in a 401(k) (compared to 16% of whites) reduced the amount they contribute per month. The median amount blacks contribute to their retirement plans is $230 per month, compared to $337 by whites. Of non-retired blacks, 22% (compared to 14% of whites) borrowed or withdrew money from a retirement account.<a href="http://www.blackenterprise.com/magazine/2010/04/15/money-matters-will-withdrawing-cause-more-hardship/" target="_blank"><strong> Read more on why you shouldn't take early withdrawals from your 401(k)</strong></a>.
</a> Though overall<a href="http://www.blackenterprise.com/wealth-for-life/2010/07/05/get-schooled-on-the-different-types-of-investments/" target="_blank"><strong> stock ownership</strong></a> among blacks declined in 2010, for the first time in the survey’s 12-year history more African Americans are choosing stocks and stock mutual funds as the “best investment overall” relative to real estate. Of course, with the high rate of foreclosure, that is not a surprise. Only 30% of Blacks said real estate was the “best investment overall” this year, compared to 41% who picked <a href="http://www.blackenterprise.com/wealth-for-life/2010/07/05/get-schooled-on-the-different-types-of-investments/" target="_blank"><strong>stocks or stock mutual funds</strong></a>. In 2004, at the height of the real estate bubble, 61% of blacks said real estate was the best investment overall. <strong>“We have learned the painful lesson that <a href="http://www.blackenterprise.com/business/2010/06/18/billions-in-wealth-lost-since-foreclosure-crisis-began/" target="_blank">real estate investing is not fool-proof </a>and are open to new ideas,” says John W. Rogers, Jr., Chairman and CEO of Ariel Investments. "Stocks are cheap and the stock market continues to have great long-term potential.”</strong><em> (Image source: Ariel Investments 2010 Black Investor Study)</em>
</a>African Americans have cut back on spending, especially compared to 2001 levels. Eight in ten African Americans, and seven in ten whites, say they have cut back on spending in the last two years. When the economy hit the skids shortly after the Sept. 11, 2001, terrorist attacks, only about 30% of African Americans and 20% of whites said they had been spending less money. <a href="http://www.blackenterprise.com/tag/spending/" target="_blank"><strong>Read more on curtailing spending. </strong></a>
</a>The median amount black households reported saving on a monthly basis is $189, compared to $367 among white households. This is the first time in a decade that African American households have reported saving less than $200 per month. <a href="http://www.blackenterprise.com/tag/saving/" target="_blank"><strong>Read more on saving.</strong></a>
</a> In terms of <a href="http://www.blackenterprise.com/magazine/2010/02/01/money-matters-preparing-for-retirement/" target="_blank"><strong>retirement</strong></a>, the outlook is also grim. When the study was conducted four year ago, 40% of blacks planned to retire before turning 60, compared to only 22% of whites. In 2010, that number is now just 21% of African Americans and 14% of whites intend to retire before 60. <a href="http://www.blackenterprise.com/tag/retirement/" target="_blank"><strong>Read more on retirement</strong></a>.
Despite being hurt more than whites by the recession, Blacks are considerably more optimistic. Nearly two-thirds of African-Americans believe the economy will turn around within the next two years, while just 50% of whites believe it will take longer than two years for an economic recovery.<em>(Image source: Ariel Investments 2010 Black Investor Study)</em>
Dear BE: my name is Julius Jones, I’M an Inventor, and I’m looking for someone to help me I
have two pantents pending that I want to get manufactured, think you might know someone that
might be interested. my phone # 323-751-8965 or 2306 W. 75th St. L.A., CA. 90043
Ty
I’m running to the fire…sorry , I must be the exception to this fear lead media world.
Saint
to BE and potential investors , tough times causes creativity to think outside the box. There are investment vehicles that we are not focusing on because it is not the traditional investments we are usually directed to. Clue : “Black Wall Street” this should redirect your perspective on investment vehicles that will lift us out of the red …
I am still watiing for one of these liberal (by their own definition!) MSM people to just freaking admit their bias.No such luck on this one, but I think you’re doing a great job pointing out the emperor’s lack of clothing….-C
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