Half of half African Americans feel better off financial than a year ago, while only 19 percent feeling worse off, according to new research.
Prudential Financial, Newark, N.J., discloses this finding in its 2013 African American Financial Experience study. Released at a media luncheon on Tuesday, the survey polled 1,153 Americans who identify as African American or Black and 471 general population Americans on a broad range of financial topics.
The report reveals that almost half of African Americans (47 percent) feel better off financially than they did five years (pre-recession). And nearly two-thirds (65 percent) feel better off than compared to the prior generation of family. These percentages compare to 51 percent and 58 percent, respectively, for the general population.
“This progress comes despite feelings that the US. Economic downturn is still ongoing, primarily due to high unemployment,” the report states. “African Americans provide financial support to unemployed family and friends at a rate nearly double that of the general population.”
The progress comes also despite the fact that only about a quarter of African Americans believe any financial services company has effectively reached out to their community. Across income levels, African-Americans are 13 percent less likely than the general population to have received contact from a financial advisor, the report notes.
The report observes also that, relative to the general public, African Americans feel significantly more confident (42 percent vs. 30 percent) and optimistic (30 percent vs. 21 percent) when making decisions about their money. Consistent with this confidence, African Americans feel less uncertain (22 percent vs. 31 percent), less anxious (18 percent vs. 28 percent) and less intimidated (5 percent vs. 10 percent) about financial decisions.
The survey adds that total household assets accounts for 17 percent of African-Americans’ positive financial outlook, as compared to 47 percent for the general population. Level of life insurance protection counts twice as much in African Americans’ financial confidence than for the general population (22 percent vs. 11 percent).
Liabilities—including health care costs, household expenses, debt and children or grandchildren’s financial future—account for an additional 31 percent of African Americans’ financial confidence. This, the report states, is six times greater than that of the general population.
The report adds the top three financial priorities of African Americans, each chosen by more than half of respondents, are reducing debt (60 percent among African Americans vs. 50 percent among the general population), saving for retirement (55 percent vs. 62 percent) and building an “emergency savings” account (54 percent vs. 41 percent).
Having enough life insurance to protect loved ones is the fourth highest priority among African Americans at 38 percent. This compares to 21 percent of the general population, the report states.