Wealth Survey Shows Huge Gaps by Race

In the most comprehensive survey of the wealth of Americans to date, the Census Bureau reported Friday that the net worth of the typical white American household in 1984 was 12 times as great as the figure for the typical black household and eight times as great as the typical net worth of Latinos.

Overall, the bureau found that the median net worth of the nation’s 86.8 million households in 1984 was $32,667. But breaking down the figures by race, the bureau found huge disparities among groups of Americans.

The median net household worth for white households was $39,135; for black households, $3,397, and for Latino households, $4,913. Nearly one-third of all black households and one-quarter of Latinos had no net assets or were in debt. Fewer than one in 10 whites had no assets at all.

The study found that 11% of all Americans--or more than 9 million households--have no net assets at all, or are in debt, and that another 21% of households hold assets worth less than $10,000.

In addition, the survey showed that 12% of American households held 38% of all personal wealth in the nation.

The findings emerged from a new census survey using a sample of 20,900 households, the most ever used for an assessment of assets.

The wealth figures reveal much greater disparities in the economic well-being of blacks, whites and Latinos than do annual income figures, which until now have been the only available measure of economic status.

Although white annual income is less than twice that of blacks and Latinos, the 12-to-1 white-black wealth ratio and 8-to-1 white-Latino wealth ratio indicate whites have reserves of assets far beyond those of blacks and Latinos.

The huge difference between the median net worth of white and black households is due partly to the large number--nearly half--of black households headed by women without a husband present and partly to low black income over generations, which has retarded the accumulation of wealth, said Gordon Green, assistant chief of the bureau’s population division.

Reported Assets Totaled

Net worth was derived by totaling the value of reported assets, such as homes, bank accounts, stocks and bonds, then deducting total liabilities, such as mortgages, loans and sums owed. A household can consist of a single person, a family or several unrelated people.

About two-fifths of net worth was in the form of equity in homes, and a sixth in the form of savings accounts, certificates of deposit and other interest-bearing accounts.

By age, the lowest median net worth was among households headed by a person under 35, only $5,764, while the highest was among households headed by a person between the ages of 55 and 64, where the median was $73,664. People 65 and over had the second highest median net worth, $60,266.

The bureau also found households with the highest median net worth are, for the most part, those with the highest annual income.

The survey’s highest income category--households with $4,000 or more in income a month--showed a median net worth of $123,474, and these households, which constituted only 12% of all households, held 38% of the nation’s total net wealth. The 26% of households that made up the lowest income group--those earning less than $900 a month--held less than 10% of total net wealth.

The survey found that households headed by married couples had the highest median net worth of any type of household structure, $50,116, while households headed by a female, whether living alone or with others such as children, were at $13,885. Those headed by a man without a wife present were even lower, at $9,883.

Married couple households were highest because many of them include two breadwinners, permitting accumulation of assets. Non-couple female-headed households had more assets than similar male-headed ones because they included large numbers of elderly widows who inherited considerable assets when their husbands died.