New Ariel-Schwab Black Investor Survey Shows Black Americans Continue to Trail Their White Counterparts in Building Wealth

Signs of younger investor engagement offer hope


Full research findings for the 2020 Ariel-Schwab Black Investor Survey

CHICAGO & WESTLAKE, Texas--()--The results of the 2020 Ariel-Schwab Black Investor Survey reveal that Black Americans are not benefitting from stock market growth at the same rate as white Americans at similar income levels. The deep-rooted gap in participation between the groups persists, with 55 percent of Black Americans and 71 percent of white Americans reporting stock market investments. This disparity, compounded over time, means that middle-class Black Americans will have less money saved for retirement and less wealth to pass onto the next generation than their white peers.

For more than 20 years, the Ariel-Schwab Black Investor Survey has compared attitudes and behaviors on saving and investing among Black and white Americans. African American participation in the stock market stands at its lowest level in the history of the survey. According to Mellody Hobson, co-CEO and President of Ariel Investments, and the driving force behind this study, “Black Americans are already behind the eight ball, and it is disheartening to see that at current savings and investing rates, the wealth gap will continue to expand, endangering our futures and leaving our families exposed.”

In a year like no other, however, there is also evidence of growing engagement in the stock market by younger Black Americans, with 63 percent under the age of 40 now participating in the stock market, equal to their white counterparts. The closing of this gap among younger investors is being driven by new investors: three times as many Black investors as white investors (15% vs. 5%) report having invested in the market for the first time in 2020. Twenty-nine percent of Black investors under the age of 40 were new to investing in 2020 compared to 16 percent of whites.

Rick Wurster, Executive Vice President, Schwab Asset Management Solutions, says, “These findings are encouraging for younger Black investors, but there is much work to be done to ensure that Black Americans have access to the resources they need to stay engaged and successfully investing for the long-term.”

His colleague Carrie Schwab-Pomerantz, President of Charles Schwab Foundation, agrees, “Many Americans are struggling to make ends meet and don’t have access to educational resources and tools that can help them avoid financial pitfalls and get on the right track. Financial literacy is a great equalizer, and a life skill that everyone needs. We have a responsibility to help people develop the knowledge and skills to become financially confident and remain lifelong savers and investors.”

401(k) Plans and Beyond

Over the last several decades, 401(k) plans have become an important gateway to investing for many Black Americans, with 63 percent of Black investors having first invested in the stock market through a retirement plan. Ownership rates of 401(k) plans are now similar between Black and white Americans (53% vs. 55%). But savings rates show meaningful differences. Specifically, white 401(k) plan participants invest 26 percent more per month toward their retirement accounts than Black 401(k) plan participants ($291 vs. $231).

Beyond investing, the survey finds that Black Americans are less likely than white Americans to own almost every kind of financial vehicle, with the exception of whole life insurance, which is favored in the Black community. They are also less likely than white Americans to have written wills, financial plans, or retirement plans.

For Black Americans, disparities grow every month; while they save $393 overall per month, whites are saving 76 percent more, at $693 per month. Even Black Americans who earn more than $100,000 a year consistently save or invest considerably less than their white counterparts at the same income level.

“These differences are not new. Black Americans are disadvantaged from the outset when it comes to building wealth,” says Hobson. She notes that while 51 percent of white Americans say they have inherited wealth, just 23 percent of Black Americans have.

Schwab-Pomerantz points out that more white Americans (44%) than Black Americans (33%) are focused on preparing for retirement as their most important financial goal. “For so many Americans, the 401(k) is the first step to becoming an investor, and while it’s encouraging to see greater parity among those who have access to this opportunity through their workplace, it’s incumbent on employers and all of us in our industry to help 401(k) owners save more throughout their earning years,” she says.

Trust Remains an Issue

Trust in the financial services industry continues to affect stock market participation among Black Americans. While similar proportions of Black and white investors believe that financial services institutions are not trustworthy (23% vs. 20%), only 35 percent of African American investors feel they are treated with respect by financial institutions versus 62 percent for white investors. Additionally, Black Americans are considerably more likely to cite the importance of racial diversity within the employee ranks at investment firms (63% vs 27%).

Black Americans are less likely to work with financial advisors (21% vs. 45% of whites), but Rick Wurster points out that the majority of Black investors who do work with a financial advisor say they feel like they are treated with respect by financial institutions, and he believes that encouraging these relationships will lead to positive change. “I believe this is a clear call to action for our industry that these partnerships should be nourished, because they can be truly impactful,” he says.

Belts Tightened but Optimism Prevails

The pandemic, not surprisingly, affected Black and white Americans in different ways financially. While both groups report a sharply increased focus on saving for emergencies compared to prior years, the pandemic’s impact on the economy caused Black Americans to take action in greater numbers than white Americans.

Black Americans were more likely to cut spending on both extras (50% vs. 41%) and basics (19% vs. 13%). Student loan delay or deferral was reported as being three times more common among Black Americans (16%) than whites (5%).

Despite this, a sizable minority of Black Americans – and significantly more than white Americans – were forced to tap their savings to make ends meet. More than twice as many Black 401(k) plan participants (12% vs. 5%) borrowed money from their retirement accounts. Almost twice as many Black Americans (18% vs. 10%) dipped into an emergency fund. And nine percent of Black Americans (vs. 4% of white Americans) say they asked their family or friends for financial support in 2020, while 18 percent of Black Americans and 13 percent of white Americans acknowledged giving financial support to family and friends last year.

Hobson emphasizes, “The pandemic has further exposed fault lines between the fortunes of middle-class Black and white Americans.” She notes although real problems persist, Black Americans remain eternally optimistic: when asked to forecast their personal financial situation in 2021 compared to 2020, 60 percent of Black Americans say they feel their situations will improve, compared to only 40 percent of white Americans who felt the same way.

This optimism, coupled perhaps with the unique circumstances of the 2020 market, created an opportunity for historically underinvested Black Americans to help one another learn more about investing. “Not only are Black Americans beginning to walk the walk, we are also beginning to talk the talk,” adds Hobson, noting that Black Americans are now much more likely to discuss the stock market with their families than in years past.


Black Americans

White Americans

Discussed Stock Market Growing Up






Discuss Stock Market Now






These dinner conversations appear to be paying off: more than twice as many Black investors under the age of 40 (18% vs. 7% of older Black investors) say they discussed the stock market growing up. Overall, about half of all Black investors (49%) say they are the first in their families to ever invest, compared to 39 percent of white investors.

Committed to Diversity and Inclusion

As the first minority-owned investment firm established in the United States, Ariel Investments is a leader in the financial services industry as it relates to diversity, equity and inclusion issues. Today, the firm is 89 percent owned by women and minorities, with women comprising over half of the organization—including 14 holding executive or senior level positions. Ariel’s efforts extend into the boardrooms of the companies it owns, cementing their legacy as change agents in the asset management industry, and by having helped place over 50 diverse individuals on portfolio company boards. Eighteen years ago, Ariel partnered with Russell Reynolds Associates to create the Black Corporate Directors Conference, bringing together leading Fortune 500 Black and Latinx directors to advance the civil rights agenda in the boardroom and across all business sectors.

Since its founding, Ariel has encouraged a firmwide policy of community involvement and civic responsibility. It has created unique educational opportunities for economically disadvantaged youth through the Ariel Education Initiative, which provides financial educational opportunities and resources for low-income, inner-city youth, which may have been otherwise unavailable. Additionally, the Ariel Community Academy (ACA) was created as a small Chicago Public School based on a student-family-school-community partnership. Lastly, in 2017, Founder John W. Rogers, Jr., partnered with the University of Chicago on a financial internship program that connects interns from underrepresented backgrounds with endowment, foundation and non-profit investment offices across the country.

Charles Schwab has been committed to creating greater access in financial services since day one. Schwab is a leader in delivering financial education through its partnerships with Boys and Girls Clubs of America,, and SIFMA Foundation, as well as its free personal finance resources available at In addition to its work with Ariel Investments, Schwab is advancing its diversity and inclusion efforts by:

  • Mobilizing a special corps of employee volunteers who will be trained to deliver financial education programs, with a special focus on underrepresented teens from low-income backgrounds
  • Funding a $3.5 million endowed scholarship program – funded through Charles Schwab Foundation – to provide financial assistance and career opportunities to college students from underrepresented communities
  • Providing mentorship opportunities to support career growth opportunities for employees of color

About the Survey

The online survey was conducted in December 2020 by Helical Research among 2,104 Americans age 18 and older with $50,000 or more household income in 2019. The margin of error for the total survey sample is two percentage points. Detailed survey results can be found here. Historical survey data can be found here.

About Ariel Investments

Ariel Investments, LLC is a global value-based asset management firm founded in 1983. The firm is headquartered in Chicago, with offices in New York City, Washington, D.C., and Sydney. As of January 31, 2021, Ariel’s firm-wide assets under management totaled approximately $15 billion. The firm serves individual and institutional investors through five no-load mutual funds and 11 separate account strategies. For more information, please visit Ariel’s website at

About Charles Schwab

At Charles Schwab we believe in the power of investing to help individuals create a better tomorrow. We have a history of challenging the status quo in our industry, innovating in ways that benefit investors and the advisors and employers who serve them, and championing our clients’ goals with passion and integrity.

More information is available at Follow us on Twitter, Facebook, YouTube and LinkedIn.

About The Charles Schwab Corporation

The Charles Schwab Corporation (NYSE: SCHW) is a leading provider of financial services, with 30.5 million active brokerage accounts, 2.1 million corporate retirement plan participants, 1.5 million banking accounts, and $6.8 trillion in client assets as of January 31, 2021. Through its operating subsidiaries, the company provides a full range of wealth management, securities brokerage, banking, asset management, custody, and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiaries, Charles Schwab & Co., Inc., TD Ameritrade, Inc., and TD Ameritrade Clearing, Inc., (members SIPC,, and their affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent, fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its primary banking subsidiary, Charles Schwab Bank, SSB (member FDIC and an Equal Housing Lender), provides banking and lending services and products. More information is available at

TD Ameritrade, Inc. and TD Ameritrade Clearing, Inc. are separate but affiliated companies and subsidiaries of TD Ameritrade Holding Corporation. TD Ameritrade Holding Corporation is a wholly owned subsidiary of The Charles Schwab Corporation. TD Ameritrade is a trademark jointly owned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank.

About Charles Schwab Foundation

Charles Schwab Foundation is an independent nonprofit public benefit corporation, funded by The Charles Schwab Corporation and classified by the IRS as a charity under section 501(c)(3) of the Internal Revenue Code. The Foundation is neither a part of Charles Schwab & Co., Inc. (member SIPC) nor its parent company, The Charles Schwab Corporation. Its mission is to educate, volunteer and advocate on behalf of those in need so that everyone has the opportunity to achieve financial well-being. More information is available at



Christina Sciarrino
Ariel Investments

Stephanie Corns
Charles Schwab

Release Summary

The 2020 Black Investor Survey reveals that Black Americans are not benefitting from stock market growth at the same rate as white Americans


Christina Sciarrino
Ariel Investments

Stephanie Corns
Charles Schwab