I’ve been thinking a lot about the ways my life, experiences, and the values I formed early on have informed my work and how I “show up” in it and my interactions each and every day. I grew up in a middle class family rooted in hard work, civic engagement, sports, and—though less spoken—a recognition that we are children and grandchildren of Jewish immigrants—on both parents’ sides—who came to this country for a better life, perhaps any life at all.
From an early age, I was adamant about justice and standing with people and communities who were ostracized or marginalized. I sat next to kids who were sitting by themselves in the cafeteria. I fought back with words when I heard my peers belittling other kids. (My Dad was a boxer and football player who tried to teach me to use a right hook, but I deplored violence and, well, was a pretty small kid.) As I grew older, I dug into learning about social and racial justice movements and the ways in which history, systems, norms, and community practices caused or perpetuated inequities. In my family, we sometimes talked about social justice, anti-Semitism, and our community’s role, responsibility, and history around movements; for we were strangers in our land—in many lands—not so long ago.
On October 20, when 11 people were killed at the Tree of Life Synagogue in the Squirrel Hill neighborhood in Pittsburgh, I felt despondent and horrified. I held my daughter’s hand extra tightly as we walked through our own synagogue’s doors the following day for her to attend religious school and for me to mourn with other congregants and community members. We stood in grief, we wept, and we recommitted to building a more just and peaceful world. And we acknowledged Tree of Life Synagogue’s long history of supporting immigrants and refugees. As others had done for us, and knowing that if not us, then who?
In these days, the narratives and climate are increasingly divisive, angry, and dehumanizing—against immigrants, refugees, people of color, LGBTQ people, and more. It is incumbent on me and on our organization to double down in naming and living out our values and commitments to community; to practice kindness, to believe in the power of goodness and possibility, and to be bolder in our work to carry out our mission.
It is in this spirit that I write now about our diversity, equity, and inclusion (DEI) work. As we look to the future and the change we strive to make, it is critical that we more formally explore and address the barriers and root causes of racial wealth inequality. We must understand and account for the historical and current systemic dynamics that affect one’s opportunities to be financially secure and to build wealth.
We also must look at ourselves to see how we show up with one another. Advancing change requires us to look within as well as externally. To that end, Prepare + Prosper has spent the last two years exploring our organizational culture, practices and procedures, communications, volunteer training, and hiring and retention. We have worked with consultants Pam Moore and Stacy Wells to look at how bias affects our attitudes and actions, and we’ve gone through several training sessions to dig in further. Our staff members have taken the Intercultural Development Inventory (IDI) assessment to deepen our understanding of where we are and our ability to engage effectively across differences.
As we do our work, we are also driven by data, narrative, and history. There are many reference points to show the racial wealth gap. Wealth is an essential indicator of economic security, as it measures a household’s financial net worth—including all assets—and thus ability to weather life transitions, emergencies, and more. For example:
- Black households own around one-tenth the wealth of white Americans. This wealth gap persists regardless of households’ education, marital status, age, or income. The median wealth for black households with a college degree equaled about 70 percent of the median wealth for white households without a college degree, and the gap is worse for older individuals.
- Home ownership is a significant asset, and households of color are much less likely to own their homes, and when they do, their home equity is, on average, significantly less. In 2017, 42 percent of Black households owned their homes and had on average $45,000 in home equity, compared with nearly 72 percent of whites who owned their homes and had, on average, $92,000 in home equity.
- People of color have, on average, much less in liquid savings. While the typical white household in 2014 had 31 days of income in savings vehicles, the typical black household had just five days’ worth.
- Retirement savings is also elusive for too many families, and people of color are more likely to work in jobs that don’t offer these benefits. Just over one-third of non-retired African Americans had retirement savings in 2016 compared with two-thirds of whites. What’s more, the median balance in retirement savings for African Americans was around one-third that of whites—$23,000 compared with $67,000, respectively.
- People of color are much more likely to use non-bank, often costly, financial services and products. Black households are more than five times more likely to be completely unbanked, and are much more likely to have no access to credit. In 2017, 36 percent of black households and 31.5 percent of Latino households had no mainstream credit, compared to 14.4 percent of white households.
These inequities have historical and current roots. Practices such as redlining, blockbusting, financing and access to credit, and racialized zoning laws have created deep segregation and blocked households of color from owning their homes and receiving adequate public investments in their neighborhoods. Too many people of color have been shut out of opportunity, for example after World War II, many if not most Black veterans were denied access to good jobs and benefits such as payment for college education through the GI bill. Generational exclusions such as these carry forward generationally; most of a person’s wealth comes through transfers. According to a study by the Urban Institute, Black and Latino families are five times less likely to receive large gifts and inheritance than White families.
Our tax code is also skewed, as it prioritizes—and incents—certain assets over other savings. Retirement savings accounts and mortgage borrowing receive preferential treatment within the tax code. Yet, as shared above, people of color are less likely to have retirement savings or to work in jobs that carry such benefits (itself a reinforcement of a kind of occupational segregation). According to a recent report by Prosperity Now and the Institution on Taxation and Economic Policy, Race, Wealth and Taxes: How the Tax Cuts and Jobs Act (TCJA) Supercharges the Racial Wealth Divide, these tilted benefits within the tax code are magnified within the new tax law, and thus will exacerbate the racial wealth divide. For example, of $275 billion directed by the TCJA at individual tax cuts in 2018, $200 billion (72%) goes to the top 20% of households, and 80% goes to White households. On average, White households will receive $2,020 in tax cuts, while Latino households will receive $970 and Black households will receive $840.
Even our nation’s safety net—which is critical for millions of adults and children—are essential for income supports and basic needs, and for keeping families afloat at the present; yet they often hinder long-term wealth building because they prohibit savings.
Despite all of this, we at Prepare + Prosper feel hopeful and ever-committed to disrupting the forces that push against equity and justice. We are building DEI into all aspects of our organization—from our customer-facing service delivery to the make-up of our staff and volunteer team to how we show up as partners, as well as our systems work around policy and the financial marketplace. We understand this work is imperative to living out our mission and vision, and know we will be smarter and better as an organization as we look to build financial opportunity and well-being for all.
Our DEI work is reflected in our 2018-2022 strategic framework, “Transforming Financial Lives, Changing Systems Together.”
