Whites Worth $113,149, While Blacks Are Worth $5,677

The Pew Research Center has released a study detailing the widest wealth gap between blacks and whites since 1984.

Apparently blacks have become poorer during the “New Recession.”

The median wealth of white U.S. households in 2009 was $113,149, compared with $6,325 for Hispanics and $5,677 for blacks

Whew.

“I am afraid that this pushes us back to what the Kerner Commission characterized as `two societies, separate and unequal,'” said Roderick Harrison, a former chief of racial statistics at the Census Bureau, referring to the 1960s presidential commission that examined U.S. race relations.

“The great difference is that the second society has now become both black and Hispanic.”

The gigantic drop is due to the differences in the creation of wealth among blacks, whites and Hispanics.

Timothy Smeeding, a University of Wisconsin-Madison professor who specializes in income inequality said,

“What’s pushing the wealth of whites is the rebound in the stock market and corporate savings, while younger Hispanics and African-Americans who bought homes in the last decade – because that was the American dream – are seeing big declines.”

We need to take some lessons from this report and rethink the way we look at wealth. It just may be time for you and your family to visit a financial planner, or take a personal finance course. Let’s create wealth so that our children will have a foundation to build upon.

• About 35 percent of black households and 31 percent of Hispanic households had zero or negative net worth in 2009, compared with 15 percent of white households. In 2005, the comparable shares were 29 percent for blacks, 23 percent for Hispanics and 11 percent for whites.

• Asians lost their top ranking to whites in median household wealth, dropping from $168,103 in 2005 to $78,066 in 2009. Like Hispanics, many Asians were concentrated in states like California hit hard by the housing downturn. More recent arrivals of new Asian immigrants, who tend to be poor, also pushed down their median wealth.

• Across all race and ethnic groups, the wealth gap between rich and poor widened. The share of wealth held by the top 10 percent of U.S. households increased from 49 percent in 2005 to 56 percent in 2009. The threshold for entry into the wealthiest top 10 percent, however, dipped lower: from $646,327 in 2005 to $598,435.

What needs to be done to close the wealth gap among blacks, whites and Hispanics?