Spending Habits – More Value on Liabilities and Less on Assets
Nielson’s “The State of African-American Consumers “report, projects that Blacks will have a collective buying power of $1.1 trillion by 2015. A study by Target Market, a company that tracks Black consumer spending, found that many Black consumers chose to use this power by spending money on luxury goods with no asset-building potential.
In 2002, Target Market reports that the Black community spent $22.9 billion on clothes, $3.2 billion on electronics and $11.6 billion on furniture. In addition, African-Americans account for 12 percent of the population, but make up 30 percent of all Scotch whiskey sales.
The Ariel Mutual Funds/Charles Schwab 2003 Black Investor Survey comparing Blacks and whites making the same income showed that whites saved for retirement 20 percent more than Blacks. The survey also found that 30 percent of Black people earning $100,000 a year barely had $5,000 in retirement savings.
