Why Wealth Building For Black And Brown Students Matters
Building wealth and understanding how to invest money is an essential skill that is often shared with children in wealthy families. To build wealth in low and middle-income communities of color, it is…
There are large wealth gaps between racial groups in the United States. According to The Brookings Institution the median family's net worth is $188,200. This is almost ten times more than what a Black family has. The median Hispanic family's net wealth is $14,000. There are many examples of Black and Brown families who have built wealth over the years. However, systemic racism at both the local and national levels has prevented the creation of large-scale assets. It is essential to learn how to manage money and build wealth. This skill is often shared by children from wealthy families. It is crucial that young people learn these skills and have opportunities to apply them in order to build wealth in low- and middle-income communities. Prudential Financial is launching the Student Investment Program, in partnership to the Student Freedom Initiative and Stackwell. This program will help create wealth for the next generation of students of color. Sarah Keh is Vice President for Inclusive Solutions at Prudential. Photo credit: Prudential. According to Sarah Keh (Vice President of Inclusive Solutions, Prudential), 'The gap in racial wealth continues to grow with every generation. Investments are one of the main ways that people build wealth. However, historically, Black Americans have been less inclined than White Americans, to invest in the stock exchange. She said that SIP would help build investor confidence and investment acumen at an early age. This will allow for a greater understanding of the financial markets and trust over the long-term. SIP, with Prudential's help, will increase access and utilization of this vital wealth-building pathway to Historically Black Colleges and Universities and Minority Serving Institutions (MSI) students.
Students attending 43 HBCUs or other MSIs in the SFI network will be eligible for grants of $500,000 as part of this multi-year partnership. The grants will be distributed over 12 months to students participating in the SFI network. This is to encourage them to keep their investment commitments and normalize wealth building behavior. Keh believes that the SIP program is a significant step towards the company's overall goal of diversifying its next generation of leaders. He notes that "increasing representation at financial markets is essential for closing the racial inequality in wealth." Prudential's vision for the future is to increase access to insurance, investing, and retirement security. Trevor Rozier-Byrd is the founder and CEO of Stackwell. Photo credit: Stackwell Stackwell is partnering up with Prudential to make investing easy and help build wealth for the Black generation. Stockwell will provide investment education and support to students through Stockwell's app and community-based engagements. The SIP program will utilize Stockwell's platform. Trevor Rozier-Byrd is the founder and CEO of Stackwell. He stated that the SIP program will use a multi-channel approach for students. This includes in-app educational content, directed content on social media, engagements and virtual and in-person workshops and focus groups. He said, "The cultural relevance of our education will be crucial as it will help [give] students the context, tools and information they need in order to increase their investor confidence." Rozier-Byrd believes that the program will have an additional benefit in that it will normalize investment and wealth conversations among students' families and friends. Prudential is also a partner in the Student Freedom Initiative, which was founded by Robert F. Smith, an African American billionaire. Keith Shoates, the CEO of the Student Freedom Initiative, answered the question, "Gen Z is unique because it has two characteristics that make it possible to benefit from this program." This is because this generation was raised with smartphones and computers that allow for this type of learning. The second characteristic of SIP is that these students live in a very different country than their parents. They have a wider realization that diversity, equity, and inclusion are essential to achieve equity at all levels of society. SIP's overall goal is to close the huge racial wealth disparity in America and provide more opportunities for communities of color.