The top 5% of African-Americans is moving closer to the top segments of white Americans in terms of wealth and farther away from the rest of African-Americans, according to a new report published by Credit Suisse in collaboration with Brandeis University’s Institute on Assets and Social Policy.
Afircan-Americans also tend to have more conservative portfolios than whites, the researchers found.
The report said that in 2009, the top 10% of African-Americans accounted for 67% of the wealth held by all African-Americans, compared with 51% for the top 10% of white Americans, up from 59% and 46%, respectively, in 2005.
Researchers focused mainly on data from the 2010 Federal Reserve Board’s Survey of Consumer Finances. The survey included some 6,500 households, of which 790 were African-American. The top 5% of African-Americans comprised 48 families.
Researchers found that the top 5% of African-Americans had a net worth of $357,000 or more — equal to approximately the 72nd percentile in the wealth distribution for white households.
The net worth for the top 5% of white Americans was 6.5 times that of the comparable African-American group — and was almost eight times higher when comparing both groups at the median across all wealth levels.
Even with a significant gap relative to the wealthier white Americans, the report found that the wealthy African-American had been very successful relative to the average American.
The median net worth for the top 5% of African Americans, $739,000, was 47 times greater than the median wealth for all African-Americans and six times greater than the median for white households.
The report said that among African-Americans in the top 5%, financial assets — usually the more volatile portion of assets — accounted for 35% of total assets relative to the 42% for the white comparison group.
This showed a more conservative asset portfolio, with a lower proportion of financial assets. Wealthy African-Americans owned less in stocks and bonds and more in CDs, savings bonds and life insurance.