What Contributes to the Wealth Gap?
Typically, higher education and other advantages improve an individual's quality of life. Studies have consistently shown that college graduates have longer life spans, better access to health care, and better dietary and health practices when compared to those with a high school-level education. Without that pathway to upward mobility, many people of color cannot make strides toward closing the wealth gap in Boston.
However, pursuing a college education often comes with its own financial challenges. Nationally, the tally for student loan debt has been on a steady incline, nearing $1.5 trillion owed. Taking into account the lower household income among nonwhite families, Black and Hispanic students are graduating from college with substantially higher debt than their white peers. The lack of affordability can prevent under-resourced students from pursuing higher education and could undermine the creation of wealth for those who accumulated debt in order to enroll. One's individual achievement is rarely enough to overcome racial and ethnic wealth inequalities because lack of education and limited resources make it difficult to achieve financial goals.
The labor market is on a job-creating streak, but not everyone has benefited. For every Black and Latinx household that has seen their net worth rise incrementally, substantial differences have not been made in their communities. Education and skill-based technological changes in the workforce have prevented under-resourced communities from competing for these roles.
Markers of privilege like owning a car make a difference, too. "Like homeownership, owning a vehicle has far-reaching implications," staff writers reported for The Color of Wealth in Boston, a joint project by Duke University, The New School, and the Federal Reserve Bank of Boston. "Those who own vehicles have access to job opportunities beyond the zones of public transportation, and they can work late or take unusual shifts because of having their own transportation."
How Eastern Bank is Starting the Conversation
Wealth disparities among communities of color in Boston have long-term effects on everything from health and quality of life to education level. Eastern Bank sees the opportunity cost in fostering a conversation about the wealth gap in our community that does not include those impacted most, so we gathered eight of our customers to find out what we need to create economic equity in communities of color. Among them were Segun Idowu, executive director of the Black Economic Council of Massachusetts; Bernadine Desanges, motivational speaker and entrepreneur; and Josiane Martinez, founder, CEO and creative director CEO of Archipelago Strategies Group.
Our richly diverse conversation helped us at Eastern Bank to outline key areas we need to concentrate on in our fight to shrink the wealth gap in Boston. While the group acknowledges there isn't an immediate solution, it's clear that transparency is the best approach to begin addressing the actual problem. As Eastern Bank continues to promote saving and asset-building, more families will learn how to acquire the resources to protect against financial hardship while investing in themselves and their children.
This Is Only the Beginning
Families building wealth can help them weather the storms of short-term economic crises and provide security for future generations. Creating opportunities for families in under-resourced communities is an approach our interview subjects believe will set us on the path toward equality. We hope to concentrate on affordable housing, equity in the labor market, and low-cost opportunities to pursue higher education, and we need your support.
We'll share more about how we intend to uplift our communities of color and the people who make them great throughout our wealth inequality conversation and campaign.
If you'd like to be a part of the solution, RSVP for our next conversation on the Wealth Gap on TBD.