FAQ 75 - Blacks & Investing

http://www.washingtonpost.com/wp-srv/WPlate/1999-05/16/022l-051699-idx.html

When Family Is First, Investing Is Second

By Michelle Singletary

Sunday, May 16, 1999; Page H01

Time and time again I hear that African Americans can't
be bothered with saving and investing because they're
too consumed with spending what money they have.

The word on the street is blacks are good consumers.
Maybe too good.

"Why can't we be more like white people and invest our
money," one woman asked me at a community meeting.

One person, who called into a radio show I do,
complained that "our people" are too interested in
wearing their wealth.

I'm more than a little disturbed that a lot of this
anecdotal criticism is coming from my own community. But
I have news for all those folks who attribute the
absence of many blacks from the stock market to buying
run amok.

To the contrary, new results of a Yankelovich Partners survey
commissioned by discount-brokerage firm Charles Schwab &
Co. and the black-owned mutual fund company Ariel
Capital Management helps dispel some stereotypes about
higher-income blacks and why they are less likely than
their white counterparts to have an investment
portfolio.

The survey conducted in late 1998 questioned 813 black
households and 816 white households with incomes of
$50,000 and higher. First of all, it found, African
American household incomes must stretch further to
support more people. What particularly caught my
attention was that 27 percent of African American
households financially support friends or family beyond
those living in their own home. That's compared with 12
percent of the white households surveyed.