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A Look at the Financial Situation of African Americans/Blacks and Hispanics: Challenges and Opportunities

This survey examines the financial situation and challenges of African Americans/Blacks and Hispanics ages 45-64 relative to general population while also exploring opportunities for outreach and education to these audiences. Conducted by GfK for AARP, the survey suggests that building up savings, paying for health care, and paying off debt are key concerns across African Americans/Blacks, Hispanics, as well as the general population, and that few feel especially confident about their financial situation. It also compares perceptions of financial health to more objective measures and concludes that many may be overly optimistic about their financial health. Suggestions related to financial education and outreach are also provided.

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Key findings include:

  • Building up savings, paying for health care, making more money, and paying off debt are key concerns across groups, with Hispanics especially likely to express concerns about these and all aspects of finances.
  • Few feel highly confident about their financial situation.  For example, no more than one in three, regardless of race/ethnicity, give themselves a high rating (8-10) when rating their overall financial health on a scale from 0 to 10.  African Americans/Blacks are least likely to give themselves a high rating. Specifically, just 21% of African Americans/Blacks rate their financial health as a 8-10, compared to 34% of Hispanics and 33% of the general public.
  • A “financial health score”, which was calculated for each survey respondent, suggests stark differences by race/ethnicity.  Just 8% of African Americans/Blacks and 17% of Hispanics received a top financial health score of “in good shape,” compared to 28% of the general population.
  • A comparison of self-ratings to financial health scores reveals that many may be overly optimistic about their financial situation.  For example, of Hispanics and African Americans/Blacks who rated their financial health as a 8-10,  fewer than three in ten received a top financial health score of “in good shape.”
  • Borrowing behavior is the top influence on financial health regardless of race/ethnicity.  Long-term planning as well as saving are also key influences.
  • While a variety of other issues and institutional barriers also influence the financial health of African Americans/Blacks and Hispanics, receiving financial education from family as a child or young adult appears to be linked to better financial health.
  • Fewer than one in four African Americans/Blacks and Hispanics have consulted a professional financial advisor even though the majority believe that “financial advisors can be helpful to anyone, even people who don’t have much money.”
  • There is a widespread desire for financial information and advice, especially related to retirement (such as how to save for retirement and how to manage money in retirement) but also in more basic topics (such as how to save generally).  

This survey was conducted for AARP by GfK Custom Research, relying primarily on the GfK KnowledgePanel, which is a probability-based online panel designed to be representative of the American public.  In order to qualify for the survey, respondents had to be ages 45-64, not yet fully retired, and involved in household financial decisions.  The sample included 862 Hispanics, 805 African Americans/Blacks, and 1,002 in the general population.  For additional information about the survey, please contact S. Kathi Brown at skbrown@aarp.org.  Members of the media should contact AARP Media Relations at media@aarp.org.

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