Tuesday, December 5, 2023
Intergenerational Wealth Transfers: Do Expectations of Leaving an Inheritance Differ Between Black and White Families?
Michael Neal, Amalie Zinn, Marokey Sawo, Linna Zhu published a Research Report: Intergenerational Wealth Transfers: Do Expectations of Leaving an Inheritance Differ Between Black and White Families? for the Urban Institute, October 31, 2023. Special thanks to Naomi Cahn (University of Virginia) for bringing this article to my attention. Provided below is an introduction to the Report:
There is a Black-white gap in intergenerational wealth transfers, characterized by a lower likelihood that Black families receive them compared to white families. This report confirms this fact and suggests that the lower incidence of intergenerational wealth transfers among Black families is not because there is a lack of intent to leave a sizeable estate. Using the 2019 Survey of Consumer Finances, we find that Black families are similarly likely as white families to indicate an expectation of leaving a sizeable estate. This finding remains consistent across several economic and demographic dimensions. At the household level, this suggests that other barriers, such as sustaining wealth through economic cycles or the presence of a will, disproportionately limit the ability of Black families to realize their intentions to transfer wealth to future generations. At the macro level, it suggests that these frictions, and not Black families’ preferences, contribute to the impact of intergenerational wealth transfers on the broader Black-white wealth gap.