White adults receive the most financial help from older relatives, survey shows: NPR

White adults are more than twice as likely as others to receive significant financial help from parents or other seniors, a new survey finds. It helps explain America’s persistent racial wealth gap.


White adults are more than twice as likely as others to receive significant financial help from parents. That’s one of the findings of a new poll by NPR and Harvard University that sheds light on America’s stark racial wealth gap. NPR’s Jennifer Ludden reports.

JENNIFER LUDDEN, BYLINE: Angela Chevaux and her husband have made a good living in York, Pa. She is an insurance claims supervisor and he is in construction. However, a recent inheritance from his father-in-law has changed his life. He left them a retirement account, a life insurance policy, an annuity. And her husband and brother inherited an old farmhouse in a secluded place with a pond.

ANGELA CHEVAUX: We were able to buy the property, the other half, from his brother at a decent price instead of having them, you know, appraised and having to sell it and buy it back.

LUDDEN: They’re renovating it to live in and selling their own house, saying goodbye to 11-plus years of payments.

CHEVAUX: We will be mortgage-free at 50 and 59.

LUDDEN: His father-in-law also left Chevaux’s 24-year-old son a money market account.

CHEVAUX: Before he died, he had given our son money for college. This then allowed him to pay off the rest of his college debt, which was not significant.

LUDDEN: Your son has invested the rest of his inheritance and plans to use it to buy a house. Thirty-eight percent of white adults say they have received at least $10,000 in gifts or loans from a parent or older relative. That’s according to a new survey by NPR, the Robert Wood Johnson Foundation and the Harvard TH Chan School of Public Health. Dorothy Brown is a professor of tax law at Georgetown University and wishes more white families would talk about these intergenerational benefits.

DOROTHY BROWN: Because you have black Americans who are doing everything they were told is right and not moving forward. And they’re scratching their heads wondering, how come I’m not doing better than I am? How come I’m not doing better than the guy in the cubicle next to me?

LUDDEN: Survey finds that only 14 percent of black adults receive similar gifts or loans. The share is 16% for Latinos and 19% for Native Americans. Brown says this divide reflects a century-plus of segregation and systemic racism, including federal housing policies.

BROWN: So if your grandfather had a house that was insured by the FHA, it was a result of him being white. You don’t think about it, but it was.

LUDDEN: For African Americans especially, Brown says the generational transfer of wealth is more likely to go the other way: children helping parents who suffered under Jim Crow.

THEODORE BAILEY: My father died when I was 3 years old. My mother was a single mother with four children.

LUDDEN: Theodore Bailey is 76 and remembers a tough childhood in segregated Nashville. His father died while he was a military cook in World War II. This led to a major break for Bailey. As a war orphan, he was able to go to college on the GI Bill. He launched his successful career as an engineer and missile designer. And from very early on he helped his mother get ahead.

BAILEY: Yes. I knew I was struggling, you know? And at that time, I didn’t have much to spare, but I sent him whatever I could. I would send him some money.

LUDDEN: Now retired in Arizona, Bailey says he’s always helped out the family — bailing out a brother who lost his job, sending grandchildren to college and more.

BAILEY: Oh, there’s always cousins ​​and nephews and (inaudible) who want to borrow money. And many times, they don’t return it.

LUDDEN: Research shows that family aid like this seriously depletes the wealth of college-educated black Americans. Bailey says she has to withdraw more from her IRA than she would like in this bad market to cover her own expenses.

ROBERT BLENDON: When people talk about the American dream, it’s here.

LUDDEN: Robert Blendon is a professor emeritus of health policy at Harvard who worked on the new survey. He says you can see the racial wealth gap in many of his other findings. The large number of black, Latino and Native American adults who want to move into better housing hope their children will go to college, but say they can’t afford it.

BLENDON: These minority communities are going to have to borrow everything in a very risky environment for this, and they don’t have anything to at least help cover some of the costs.

LUDDEN: What’s at stake, he says, is the ability to make the decisions that can help families and future generations move forward. Jennifer Ludden, NPR News.

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About the Author: Chaz Cutler

My name is Chasity. I love to follow the stock market and financial news!