How Do Black People Spend Their Money? (The Racial Wealth Gap)

The Legacy Series contains the most read articles in the history of this website.  This is the #2 most read article in the history of Black Men In America.com.

By Gary A. Johnson – Black Men In America.com

Updated December 28, 2022 (Originally posted on November 5, 2010).

How black people spend their money has been a hotly debated topic in offices, at social events, and in beauty and barber shops across America. This article, “How Do Black People Spend Their Money?,” has been the most read and commented article for 12 years running.  Once I learned that this was the most popular and discussed article on the website, I decided to do some research and share this information with others. Over the years I found the process of gathering data and updating the site to be exhausting. It’s a lot to read. I update the site 1-2 times per year. This year I decided to update the article via video in the form of a pictorial slideshow. This way the reader has options. You can watch a 9-minute video which is the equivalent of having a summary video or a “Cliff Notes” version of how Black people spend their money, which includes a new component. I developed, “Gary’s 10 Tips To Prosperity and Emotional Fulfillment,” as part of the 2022 update.  Or, you can read and review the exhaustive data and charts/graphs.

Here’s something to think about.   Blogger Matthew Corbin lists 5 Reasons Why Black People Are Still Broke.

Here are Corbin’s 5 reasons:

1. Black people spend more money than they make
2. Black people don’t support black businesses
3. Black people don’t save their money
4. Black people don’t know how to invest
5. Black people aren’t working towards getting out of poverty

Click here to read Corbin’s explanation for each reason.

There is an article on Mater Meta.com, by Kimberly Anderson-Mutch, about how to build generational wealth.  Kimberly outlines the following 5 things that Black families can do to build generational wealth.

1. Talk to your children about wealth.
2. Buy a home or invest in real estate to create generational wealth.
3. Start a business.
4. Invest in stocks.
5. Establish an estate plan.

A recently released study by Merrill Lynch explored the ways wealthy Black people in the US spend their money.

What they found is that many well-to-do Black Americans:

• Take care of their family members, invest in their friends’ businesses, and eliminate debt
• Spend their earnings preparing for the future and retirement

The study, entitled “Diverse Viewpoints: Exploring Wealth in the Black/African American Community,” surveyed 455 affluent Black people –– defined as a household with annual income of $125,000 or more. The study’s findings indicate that this group of the US population is actually growing in size and has been since 2015.

The study participants reported working harder than other people in the affluent income category and charter their own career pathways. Affluent Black in the US are five times more likely to financially support their parents than other affluent people and four times more likely to plan to start their own business.

Another great source of information is “How Black/African Americans Pursue—and Define—Success,“ by Diallo Hall, a longtime content strategist and editor whose experience includes serving as Director of Thought Leadership at Fortune and Senior Editor at the Economist Intelligence Unit.  In that article you will read about the “Black Rules for Success,” from other successful Black/African American survey respondents.

Part 1:  The Narrative

Part 2:  The Pictorial Slideshow of How Black People Spend Their Money

Warning:  The following is a link to a long article with a lot of details, numbers, observations and opinions covering over two decades of information and data.  A large portion of the data was gathered before COVID-19.

Click Here To Read The Entire Updated “How Do Black People Spend Their Money?”

How black people spend their money has been a hotly debated topic not only on this site, but in our office, at social events and in beauty and barber shops across America.  This article has been the most read and commented article for 12 years running.  Once I learned that this was the most popular and discussed article on the website, I decided to do some research and share this information with others.

Click Here To Read The Entire Updated “How Do Black People Spend Their Money?”

Let’s start by watching this short video that explains the “racial wealth gap” in America.

Check out this 1954 film made to educate white merchants on the spending habits of Black Americans.

The Secret of Selling the Negro Market is a 1954 film financed by Johnson Publishing Company, the publisher of Ebony magazine, to encourage advertisers to promote their products and services in the African-American media. The film showed African-American professionals, housewives and students as participants in the American consumer society, and it emphasized the economic power of this demographic community. The film, which was shot in Kodachrome Color, featured appearances by Sinclair Weeks, Secretary of the U.S. Department of Commerce, and radio announcer Robert Trout. The film had its premiere in July 1954 at the Joseph Schlitz Brewing Company in Milwaukee, Wisconsin, and was shown on a non-theatrical basis.

Watch this film and measure how far we’ve come over the last 60+ years.

Click Here To Read The Entire Updated Article

The series of articles and versions of “How Do Black People Spend Their Money?” contain opinions from outside sources not affiliated with Black Men In America.com.  This series is for information and educational purposes only. The opinions and views expressed do not necessarily reflect the opinions and views of Gary Johnson, Black Men In America.com or any of its affiliates.

Gary is the Founder and Publisher of Black Men In America.com, an online news and magazine, Black Boating and Yachting.com and several other online sites.  Gary is also the author of the book “25 Things That Really Matter In Life,”:  A Quick and Comprehensive Guide To Making Your Life Better—Today! and “The Black Father Perspective: What We Want America To Know,” and “In Search of Fatherhood – Transcending Boundaries: International Conversations on Fatherhood.“  In 2019, Gary developed a line of spices under the name of “MasterChef Gary’s Premium Organic Seasoning.”  In 2021, Gary launched a motivational website and talk show called “Calculations.“  For motivational content and exclusive interviews with interesting people, visit Calculations Talk Show.com.  In his spare time, Gary uses his platform to help the Black Farmers of America.  He built the website Justice for Black Farmers to help educate others about the plight of the Black Farmer and their fight against the U.S. Department of Agriculture.

Click Here To Read The Entire Updated “How Do Black People Spend Their Money?”

Updated: How Do Black People Spend Their Money?

The Legacy Series contains the most read articles in the history of this website.  This is the #2 most read article in the history of Black Men In America.com.

By Gary A. Johnson – Black Men In America.com

Updated December 28, 2022 (Originally posted on November 5, 2010).

How black people spend their money has been a hotly debated topic in offices, at social events, and in beauty and barber shops across America. This article, “How Do Black People Spend Their Money?,” has been the most read and commented article for 12 years running.  Once I learned that this was the most popular and discussed article on the website, I decided to do some research and share this information with others. Over the years I found the process of gathering data and updating the site to be exhausting. It’s a lot to read. I update the site 1-2 times per year. This year I decided to update the article via video in the form of a pictorial slideshow. This way the reader has options. You can watch a 9-minute video which is the equivalent of having a summary video or a “Cliff Notes” version of how Black people spend their money, which includes a new component. I developed, “Gary’s 10 Tips To Prosperity and Emotional Fulfillment,” as part of the 2022 update.  Or, you can read and review the exhaustive data and charts/graphs.

Here’s something to think about.   Blogger Matthew Corbin lists 5 Reasons Why Black People Are Still Broke.

Here are Corbin’s 5 reasons:

1. Black people spend more money than they make
2. Black people don’t support black businesses
3. Black people don’t save their money
4. Black people don’t know how to invest
5. Black people aren’t working towards getting out of poverty

Click here to read Corbin’s explanation for each reason.

There is an article on Mater Meta.com, by Kimberly Anderson-Mutch, about how to build generational wealth.  Kimberly outlines the following 5 things that Black families can do to build generational wealth.

1. Talk to your children about wealth.
2. Buy a home or invest in real estate to create generational wealth.
3. Start a business.
4. Invest in stocks.
5. Establish an estate plan.

A recently released study by Merrill Lynch explored the ways wealthy Black people in the US spend their money.

What they found is that many well-to-do Black Americans:

• Take care of their family members, invest in their friends’ businesses, and eliminate debt
• Spend their earnings preparing for the future and retirement

The study, entitled “Diverse Viewpoints: Exploring Wealth in the Black/African American Community,” surveyed 455 affluent Black people –– defined as a household with annual income of $125,000 or more. The study’s findings indicate that this group of the US population is actually growing in size and has been since 2015.

The study participants reported working harder than other people in the affluent income category and charter their own career pathways. Affluent Black in the US are five times more likely to financially support their parents than other affluent people and four times more likely to plan to start their own business.

Another great source of information is “How Black/African Americans Pursue—and Define—Success,“ by Diallo Hall, a longtime content strategist and editor whose experience includes serving as Director of Thought Leadership at Fortune and Senior Editor at the Economist Intelligence Unit.  In that article you will read about the “Black Rules for Success,” from other successful Black/African American survey respondents.

Part 1:  The Narrative

Part 2:  The Pictorial Slideshow of How Black People Spend Their Money

Warning:  The following is a link to a long article with a lot of details, numbers, observations and opinions covering over two decades of information and data.  A large portion of the data was gathered before COVID-19.

Click Here To Read The Entire Updated “How Do Black People Spend Their Money?”

How black people spend their money has been a hotly debated topic not only on this site, but in our office, at social events and in beauty and barber shops across America.  This article has been the most read and commented article for 12 years running.  Once I learned that this was the most popular and discussed article on the website, I decided to do some research and share this information with others.

Click Here To Read The Entire Updated “How Do Black People Spend Their Money?”

Let’s start by watching this short video that explains the “racial wealth gap” in America.

Check out this 1954 film made to educate white merchants on the spending habits of Black Americans.

The Secret of Selling the Negro Market is a 1954 film financed by Johnson Publishing Company, the publisher of Ebony magazine, to encourage advertisers to promote their products and services in the African-American media. The film showed African-American professionals, housewives and students as participants in the American consumer society, and it emphasized the economic power of this demographic community. The film, which was shot in Kodachrome Color, featured appearances by Sinclair Weeks, Secretary of the U.S. Department of Commerce, and radio announcer Robert Trout. The film had its premiere in July 1954 at the Joseph Schlitz Brewing Company in Milwaukee, Wisconsin, and was shown on a non-theatrical basis.

Watch this film and measure how far we’ve come over the last 60+ years.

Click Here To Read The Entire Updated Article

The series of articles and versions of “How Do Black People Spend Their Money?” contain opinions from outside sources not affiliated with Black Men In America.com.  This series is for information and educational purposes only. The opinions and views expressed do not necessarily reflect the opinions and views of Gary Johnson, Black Men In America.com or any of its affiliates.

Gary is the Founder and Publisher of Black Men In America.com, an online news and magazine, Black Boating and Yachting.com and several other online sites.  Gary is also the author of the book “25 Things That Really Matter In Life,”:  A Quick and Comprehensive Guide To Making Your Life Better—Today! and “The Black Father Perspective: What We Want America To Know,” and “In Search of Fatherhood – Transcending Boundaries: International Conversations on Fatherhood.“  In 2019, Gary developed a line of spices under the name of “MasterChef Gary’s Premium Organic Seasoning.”  In 2021, Gary launched a motivational website and talk show called “Calculations.“  For motivational content and exclusive interviews with interesting people, visit Calculations Talk Show.com.  In his spare time, Gary uses his platform to help the Black Farmers of America.  He built the website Justice for Black Farmers to help educate others about the plight of the Black Farmer and their fight against the U.S. Department of Agriculture.

Click Here To Read The Entire Updated “How Do Black People Spend Their Money?”

Year In Review: How Do Black People Spend Their Money?

Originally posted on November 5, 2010.  Updated December 27, 2013.

As we look at the year in review, the most popular article posted on this website/blog was an article detailing how black people spend their money.  The article was “How Do Black People in America Spend $507 Billion Dollars Annually?”

This article has been the most read and commented article for 3 years running.  Once I learned that this was the most popular and discussed article on the website, two questions immediately came to my mind:

1. What does that say about the topic in terms of being relevant to our site visitors?
2. Has anything changed?

This has been a hotly debated topic not only on this site, but in our office, at social events and in beauty and barber shops across America.

We’ve updated our original article with some information from an article written in September 2013, by Stacy M. Brown posted on the Washington Informer.com website titled, “Big Spenders, Small Investors:  Blacks Have Little to Show for Hard-Earned Dollars.”  In that article, Ms. Brown writes, “If black America counted as an independent country, its wealth would rank 11th in the world.  However, African Americans continue to squander their vast spending power, relegating blacks to economic slavery instead of financial freedom, according to several consumer reports detailing the use of cash in the black community.”

If history is any indication of future behavior, this updated article will be hotly debated in 2014.  Let’s hope that we can make some progress in this area and close the wealth gap.

Happy New Year!

Gary Johnson, Founder & Publisher – Black Men In America.com

Other highlights from “Big Spenders, Small Investors:  Blacks Have Little to Show for Hard-Earned Dollars” include the following:

• African Americans consistently outpace the total market population in overall growth, smart phone ownership, television viewing and annual shopping trips according to the new study, “Resilient, Receptive and Relevant: The African-American Consumer 2013 Report,” a collaborative effort by the Nielsen Company in New York and the National Newspaper Publishers Association (NNPA), located in Northwest Washington, D.C.

• Black buying power continues to increase, rising from its current $1 trillion level to a forecasted $1.3 trillion by 2017.

• Despite the strong economic outlook, blacks continue to spend most of their money outside of the African-American community and, according to Nielsen and NNPA, advertisers have repeatedly slighted the black media, spending only three percent, or $2.24 billion, of the $75 billion spent with all media last year.

• Each year, African Americans spend more than $47 billion on Lincoln automobiles, $3.7 billion on alcohol, $2.5 billion on Toyotas, $2 billion on athletic shoes, and $600 million each year on McDonald’s and other fast foods, according to Target Market News Inc., a Chicago-based marketing research group.

• Blacks also spend wildly to keep up their appearances.  The black hair care and cosmetics industry counts as a $9 billion a year business, but while African Americans are spending the most, they are profiting the least, said officials from the Black Owned Beauty Supply Association (BOBSA) in Palo Alto, Calif.  Beauty product lines designed for African Americans were once 100 percent owned and operated by blacks, today other ethnic groups control more than 70 percent of the market.

• The current home-ownership rate reveals that 73.5 percent of whites own homes while approximately 43.9 percent of African Americans are homeowners, according to the Harvard Joint Center for Housing Studies State of the Nation report for 2013.

• Sixty percent of African Americans have less than $50,000 saved in company retirement plans and only 23 percent have more than $100,000.

The loyalty blacks have to their church also has proven costly, said officials at Faith Communities Today, a nonprofit based in Hartford, Conn.  A 2013 study revealed that black churches have collected more than $420 billion in tithes and donations nationwide since 1980, an average of $252 million a week.

“What people fail to see and understand is that, the church pastors aren’t waiting for miracles to fund their lifestyles, they don’t have to pray, day in and day out, to make their ends meet,” said Northwest resident and author, Byron Woulard.  They are getting rich off God, not from God,” he said. Woulard, whose books include, the 2011, “Pawn Queen,” noted that the money spent tithing could buy as many as 93,333 homes valued at $150,000; pay for tuition up to $15,000 a year for 933,333 college students, and feed every homeless American for a year.  “It’s the best hustle on the planet. If you don’t get it here on earth, you’ll get it when you die and go to heaven,” Woulard said. “And, it just so happens that not one person in the history of this planet has died, went to heaven, and come back to tell everyone that it’s true.”

Stacy M. Brown’s article posted on the Washington Informer.com website concludes with what is described as an inescapable fact:    When black folks make money, they are quick to spend it!

According to Dr. Boyce Watkins, a Scholar in Residence in Entrepreneurship and Innovation at Syracuse University in New York, also known as “the people’s scholar,” “We don’t use money to invest or produce,” said Watkins, 42.” When we get our tax refund, we go straight to the store.”

The 17th annual report on “The Buying Power of Black America” also includes a dollar-by-dollar breakdown of the Black economy.

Copies of “The Buying Power of Black America” can be purchased from Target Market News for $99.00  for the hard copy version and $65.00 for the digital version.  For more information call 312-408-1881, or click here to purchase online.

Below is our original article posted in November 2010.  Have their been any improvements?  You be the judge.

“How Do Black People in America Spend $507 Billion Dollars Annually?”

With $836 Billion in Total Earning Power, only $321 Million Spent on Books while $7.4 Billion Spent on Hair and Personal Care Products and Services

New ‘Buying Power’ report shows black consumers spend as economy improves

New 16th edition shows expenditures rise to $507 billion

(November 1, 2010) African-American consumers are cautiously increasing their spending in some key product categories, even as they continue to make adjustments in a slowly growing economy. The finding comes from the soon to be issued 16th annual edition of “The Buying Power of Black America” report.

In 2009, black households spent an estimated $507 billion in 27 product and services categories. That’s an increase of 16.6% over the $435 billion spent in 2008. African-Americans’ total earned income for 2009 is estimated at $836 billion.

The report, which is published annually by Target Market News, also contains data that reflect the economic hardships all consumers are facing. There were significant declines in categories — like food and apparel — that have routinely shown growth in black consumers’ spending from year-to-year.

“These latest shifts in spending habits are vital for marketers to understand,” said Ken Smikle, president of Target Market News and editor of the report, “because they represent both opportunities and challenges in the competition for the billions of dollars spent by African-American households. Expenditures between 2007 and 2008 were statistically flat, so black consumers are now making purchases they have long delayed.  At the same time, they re-prioritizing their budgets, and spending more on things that add value to their homes and add to the quality of life.”

The median household income for African-Americans dropped by 1.4% in 2009, but because of students going out on their own, and couples that started their lives together, the number of black households grew 4.2%. This increase meant that many household items showed big gains. For example, purchases of appliances rose by 33%, consumer electronics increased 33%, household furnishings climbed 28%, and housewares went up by 37%.

Estimated Expenditures by Black Households – 2009

Apparel Products and Services	$29.3 billion
Appliances	2.0 billion
Beverages (Alcoholic)	3.0 billion
Beverages (Non-Alcoholic)	2.8 billion
Books	321 million
Cars and Trucks – New & Used	29.1 billion
Computers	3.6 billion
Consumer Electronics	6.1 billion
Contributions	17.3 billion
Education	7.5 billion
Entertainment and Leisure	3.1 billion
Food	65.2 billion
Gifts	9.6 billion
Health Care	23.6 billion
Households Furnishings & Equipment	16.5 billion
Housewares	1.1 billion
Housing and Related Charges	203.8 billion
Insurance	21.3 billion
Media	8.8 billion
Miscellaneous	8.3 billion
Personal and Professional Services	4.1 billion
Personal Care Products and Services	7.4 billion
Sports and Recreational Equipment	995 million
Telephone Services	18.6 billion
Tobacco Products	3.3 billion
Toys, Games and Pets	3.5 billion
Travel, Transportation and Lodging	6.0 billion

Source: Target Market News,

“The Buying Power of Black American – 2010”

“The Buying Power of Black America” is one of the nation’s most quoted sources of information on African-American consumer spending. It is used by hundreds of Fortune 1000 corporations, leading advertising agencies, major media companies and research firms.

The report is an analysis of consumer expenditure (CE) data compiled annually by the U.S. Department of Commerce. The CE data is compiled from more than 3,000 black households nationally through dairies and interviews. This information is also used for, among things, computing the Consumer Price Index.

The report provides updated information in five sections:

– Black Income Data
– Purchases in the Top 30 Black Cities
– Expenditure Trends in 26 Product & Services Categories
– The 100-Plus Index of Black vs. White Expenditures
– Demographic Data on the Black Population

Click here to read comments in response to the original article.