The Reality of Racial Economic Inequality for Black Retirees

From Joint Center Report
Joint Center
https://jointcenter.org/

Racial economic inequality has shaped the lives of most African Americans, and it continues into the “golden years” of retirement.

In 2022, the typical white family held about $285,000 in wealth, while the typical Black family held about $44,900. In other words, the typical Black family had less than one-sixth of the wealth of the typical white family.

This snapshot, The Reality of Racial Economic Inequality for Black Retirees, examines how Black retirement insecurity reflects the cumulative effects of the racial wealth divide, lower earnings, lower homeownership, reduced financial buffers, greater debt burdens, and unequal access to intergenerational wealth transfer.

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Racial economic inequality has shaped the lives of most African Americans, and it continues into the “golden years’ of retirement.

In 2022, the typical white family held about $285,000 in wealth, while the typical Black family held about $44,900. In other words, the typical Black family had less than one-sixth of the wealth of the typical white family.

Homeownership is particularly significant as it is a key method for families to accumulate wealth and one of the largest financial assets many households retain into retirement. However, the Black homeownership rate in 2025 was only 44.7 percent compared to 74.6 percent for non-Hispanic white households.

Income also shapes retirement readiness. In 2025, median weekly earnings for full-time Black workers were $986, compared with $1,231 for white workers. At the household level, the disparity widens. In 2024, median household income for Black households was $56,020, compared with $92,530 for non-Hispanic white households. Put differently, Black households had only about 61 percent of the median household income of non-Hispanic white households. These income gaps leave less room to save, make it harder to absorb financial shocks, and reduce the likelihood that Black workers can build meaningful retirement balances over time.

The Federal Reserve found that in 2024, only 41 percent of Black adults had emergency savings sufficient to cover three months of expenses, compared with 60 percent of white adults. The same report found that among nonretirees, 52 percent of Black adults had a tax-preferred retirement account, compared with 68 percent of white adults, and only 26 percent of Black nonretirees said their retirement savings were on track, compared with 41 percent of white nonretirees.

These figures show that Black retirement insecurity is not simply a problem that appears at retirement age. It reflects a weaker financial footing across the life course.

The consequences of these disparities are visible in the current economic conditions of Black seniors. Among adults ages 65 and older, approximately 18 percent of African Americans lived in poverty in 2022. This is more than twice the rate of non-Hispanic white older adults, at approximately 8 percent. For most Black seniors, Social Security is the primary, and often the sole, source of income in retirement. But because Social Security benefits are tied to lifetime earnings, Black seniors receive less. The Social Security Administration projected that in 2024, the median monthly Social Security benefit for Black men age 60 and older was $1,685, compared with $2,179 for non-Hispanic white men. For Black women, the projected median monthly benefit was $1,557, compared with $1,692 for non-Hispanic white women. Annualized, those amounts equal $20,220 for Black men and $18,684 for
Black women, compared with $26,148 for non-Hispanic white men and $20,304 for non-Hispanic white women. For Black women, that projected annual benefit remains only modestly above the 2024 federal poverty threshold for an elderly individual, which was $15,045.

The wealth divide follows Black seniors into old age as well. Black workers ages 51 to 64 are the least likely among all racial and ethnic groups to hold a retirement account, and when they do, their median balance is well below that of similarly aged white adults at every income level. Black households had a median income of approximately $32,000, compared to roughly $47,000 for white households. These income shortfalls carry real consequences. In 2022, food insecurity among Black seniors stood at 19.5 percent, more than 2 times the rate among white non-Hispanic seniors at 9.3%. Additionally, older Black adults face heightened economic
insecurity because many have incomes that are insufficient to meet daily expenses, and those hardships are shaped by local housing and cost-of-living conditions.

Retirement Security Requires More Than a Retirement Account

A secure retirement depends on stable earnings, room to save, access to workplace benefits, ownership of appreciating assets, and public supports that help households remain financially secure in old age. Even when Black households do gain access to retirement accounts, the years of racial income equality grow to even broader disparities in retirement. AARP reports that among account holders, the median retirement account balance for Black Americans was about $35,000, compared with $80,000 for white Americans.

Black Retirement Insecurity

Black retirement is often so insecure because Black households are less likely to have the assets and financial buffers that support long-term stability. Lower wealth, lower homeownership, lower earnings, and lower retirement account balances all make it harder to prepare for retirement and harder to weather setbacks without undermining future security.

Recent research shows that these disparities persist even among households with relatively high incomes. Among respondents with incomes of $75,000 or more, 77 percent of Black Americans reported having saved for retirement, compared with 87 percent of non-Black Americans. In that same income group, 63 percent of Black Americans said debt was a major or minor problem for their household, compared with 45 percent of non-Black Americans.

Wealth Transfer and Ongoing Economic Disparity

Retirement security is shaped not only by what individuals earn and save, but also by what families pass from one generation to the next. Inheritances and family gifts are transferred wealth that strengthens opportunities for future wealth building, such as down payment assistance for homeownership and other large expenditures. They can also reduce debt, cushion emergencies, and preserve retirement savings for later life.

Intergenerational transfers also serve as a mechanism to reinforce racial economic inequality. It is only a small number of Americans who expect to receive an inheritance, and this number dwindles further for African Americans. A 2023 Urban Institute report found that 17 percent of white households expected to receive an inheritance, compared with just 6 percent of Black households. Another study found that 30 percent of White households had received an inheritance, at an average value of nearly $200,000, compared with 10 percent of Black households, at an average value of $100,000. The gap also appears in family transfers more broadly, with 34.8 percent of white individuals receiving a transfer, compared with 13.2 percent of Black individuals.

Families that were historically excluded from land ownership, mortgage credit, quality jobs, and other wealth building opportunities have less wealth to pass on. As a result, many Black households approach retirement with fewer family resources to help with housing, emergencies, education costs, or caregiving burdens that might otherwise preserve retirement savings.

Structural Barriers Continue to Shape Retirement Outcomes

The structural barriers facing Black households are visible not only before retirement but during retirement as well. Research found that among retirees who left the workforce earlier than planned, Black retirees were more likely than non-Black retirees to say they did so because of a health problem or disability, 44 percent compared with 32 percent. 19 It also found that among retirees who worked for pay after retiring, Black retirees were far more likely to say they did so because they needed money to make ends meet, 66 percent compared with 35 percent of non-Black retirees.

These findings suggest that Black Americans are more likely to experience retirement as financially fragile, with less choice and less protection against illness, disability, or rising costs. Limited access to financial advice may also play a role. AARP reports that in a 2023 Allianz Life survey, 36 percent of Black respondents said they had a financial adviser, compared with 47 percent of white respondents. The same report noted that less than 2 percent of certified financial planners are African American.

The cumulative effects of these inequalities have developed into a multi-generational cycle of low wealth for African Americans and ongoing racial wealth/ economic inequality. Social Security Administration projections show that among beneficiaries age 60 and older in 2050, the official poverty rate for Black non-Hispanic beneficiaries is projected to be 7 percent, compared with 3 percent for
white non-Hispanic beneficiaries.

Conclusion

Black retirement insecurity reflects the cumulative effects of the racial wealth divide, lower earnings, lower homeownership, reduced financial buffers, greater debt burdens, and unequal access to intergenerational wealth transfer. A stronger conversation about retirement must therefore begin with a broader understanding of how economic security is built over time. Retirement is not just about what happens at the end of a person’s working life. It is shaped by whether households had the opportunity to build wealth, withstand shocks, and pass resources across generations long before retirement begins. Social Security Administration projections suggest that racial disparities in later-life wealth are likely to persist through 2050, with Black beneficiaries projected to have lower median household wealth and higher poverty rates than white beneficiaries.

References

1. Federal Reserve Board, “Greater Wealth, Greater Uncertainty: Changes in Racial Inequality in the Survey of Consumer Finances, Accessible Data.”
2. U.S. Census Bureau, Housing Vacancies and Homeownership: Annual Statistics 2025, Table 22. Homeownership Rates by Race and Ethnicity of Householder , Current Population Survey/Housing Vacancy Survey, revised Mar. 24, 2026.
3. U.S. Bureau of Labor Statistics, “Median weekly earnings of full-time wage and salary workers by selected characteristics,” 2025 annual averages.
4. U.S. Census Bureau, Income in the United States: 2024 , Current Population Reports, P60-286, Sept. 2025, Figure 2.
5. Federal Reserve Board, “Report on the Economic Well-Being of U.S. Households in 2024: Savings and Investments.”
6. Population Reference Bureau, “Fact Sheet: Aging in the United States.”
7. Urban Institute, “Limitations on Social Security Benefits for Black Retirees: Exploring Structural Racism’s Impact” (April 19, 2023).
8. Social Security Administration, “Projected Profile of Beneficiaries.”
9. Emily A. Shrider and Christina Bijou, U.S. Census Bureau, Poverty in the United States: 2024, Current Population Reports, P60-287, U.S.
   Government Publishing Office, Washington, DC, September 2025.
10. AARP, “Racial Retirement Savings Gap Persists, Studies Show.” February 2024.
11. Center on Budget and Policy Priorities, “Social Security Benefits Are Modest.” December 2023.
12. Feeding America, “Food Insecurity Among Seniors and Older Adults in 2022.” July 2024.
13. American Society on Aging, “Precarious Aging: The Spatial Context of Racial and Ethnic Disparities in Economic Security.” Generations.
14. AARP, “Getting Retirement Advice Isn’t Always Easy for Black Savers.”
15. Employee Benefit Research Institute, “2025 Retirement Confidence Survey: A Closer Look at Black Americans.”
16. Urban Institute, Intergenerational Wealth Transfers: Do Expectations of Leaving an Inheritance Differ Between Black and White Families?
    October 31, 2023.
17. Brookings, “The Black-white wealth gap left Black households more vulnerable.”
18. Federal Reserve Bank of Richmond, “How Big Is the Inheritance Gap Between Black and White Families?”
19. Employee Benefit Research Institute, “2025 Retirement Confidence Survey: A Closer Look at Black Americans.”
20. Id.
21. AARP, “Getting Retirement Advice Isn’t Always Easy for Black Savers.”
22. Id.
23. Social Security Administration, “Demographic Projection: Beneficiaries Aged 60+ by Race & Ethnicity.”
24. Social Security Administration, “Taxpayers Aged 31+ by Race & Ethnicity.”

Acknowledgments
The Joint Center for Political and Economic Studies thanks the staff who compiled and reviewed the data underlying this snapshot.