3 ways to overcome the wealth gap as a black woman in America

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• I network with other professionals and pay attention to which companies value my work and pay me fairly.
• I am constantly learning about the value of homeownership and opportunities such as down payment assistance.
• I read a lot about saving and investing and use investment apps that allow me to easily build wealth.

Growing up, my parents taught me that racial disparities exist in many forms. But when I started my financial journey in 2015, seeing the cold-blooded data behind the racial wealth gap hit me like a ton of bricks.

by federal reserve, White Americans hold 84% of the wealth in the United States and make up 60% of the population. Meanwhile, black Americans hold 4% of the wealth and make up 13% of the population.

in fact, 2022 data A study by the Federal Reserve Bank of St. Louis found that black households had, on average, about $957,000 less in wealth and Hispanic households had $982,000 less in wealth than white families.

Although these numbers seem discouraging, I have never been more encouraged to build wealth as a Black woman in America. I have four siblings and we often talk about how we want to be the generation to build wealth and pass something on to our children.

Here are three things I am doing to make this dream come true.

1. Make sure you have a say in your income

I became self-employed in 2016. I don’t think this is a career solution for everyone, but I really appreciate being able to set and negotiate my own rates. You may still struggle to charge enough for freelance services like content writing or digital marketing.

However, I tend to look closely at how much my services are worth, and I’m not afraid to network with other freelancers. About two years ago, I joined a group with other self-employed people to share tips and clues and encourage each other to be more successful.

By joining this group, I gained confidence in my ability to overcome the mindset blocks that were preventing me from charging what I felt I was worth. We know that there is a pay gap, but we can’t afford to be paid less.

My husband is a W-2 employee, so I encourage him to research salary and compensation trends as well. We use sites like Payscale, Glassdoor, Salary.com, and other public wage reports from a variety of companies. We also discuss how we can gain more professional experience and develop more valuable skills in the workplace, as well as companies and brands that demonstrate their ability to pay fair wages for minority work. Masu.

2. Educate yourself to buy a home with confidence

I believe that owning a home is important in building wealth. Pew Research backs up my idea by sharing statistics that show the direct relationship between homeownership and net worth.

pew research Citing 2022 data from the U.S. Census Bureau, 74.6% of white households owned their homes, compared to 45.3% of black households. Racial disparities, prejudice, and discrimination also play a significant role in these outcomes, making it difficult for some Black Americans to become homeowners.

Back in 2016, my husband and I knew we wanted to become homeowners, so we started planning for it a year or two in advance. We built up our credit and attended free homeowner education classes hosted by our local mortgage company.

I learned about the down payment subsidy system. And when I bought a house in 2018, I was able to receive a grant to increase my down payment. The process of buying and caring for a house taught us a lot and actually sparked our interest in real estate investing. The ability to build equity through homeownership has helped me build wealth.

3. Make learning to save and invest a new hobby.

A few years ago, I dove deep into the world of personal finance. I love reading blogs, watching educational videos, and reading financial books. I found a book called “The Simple Path to Wealth” and read it twice. Although not everything in this book was directly relevant to me, there were still some important points.

What shocked me was the fact that you can start investing with a small amount of money. I started putting money into fractional shares through his app called Stash. I then started saving with Acorns and was impressed to see my money grow over time.

I opened my first IRA in 2017 and contributed everything I could. It wasn’t until 2020 that I was actually able to max out my donations for the first time.

It took me a while, but I still have a lot to learn and am still on the journey. Overall, taking the time and money to learn more about money has helped me make smarter money decisions and build better wealth as a Black woman.