A new endeavor from JPMorgan Chase is trying to help close the racial wealth gap.
The bank’s Advancing Black Wealth Tour, launched this spring, aims to give attendees the tools they need to manage their finances and build sustainable wealth — even with the possibility of a recession on the horizon.
The most recent tour stop was in Philadelphia earlier this month. Previous stop also included Los Angeles and New Orleans. More events are planned for 2023.
“When we look at the Black community historically, there has been a very significant gap in terms of awareness of how to grow wealth,” said Justin Grant, executive director of JPMorgan’s Advancing Black Pathways education and training program. The tour is a collaboration between Advancing Black Pathways and local Chase leaders.
“We want it to be actionable,” Grant said. “We don’t want to just talk to people, inspire them and then they leave and forget everything. We’re going to provide them with very constructive tools and resources so they can take what they learn and act on it.”
The racial wealth gap describes the disparity in wealth between Black and white households in the United States. It’s significant: During the first quarter of 2022, the average Black family had $0.24 for every dollar of wealth held by white families, according to the Federal Reserve Bank of St. Louis.
Collectively, the racial wealth gap is estimated to be at least $14 trillion, according to William A. Darity, Jr., director of the Samuel DuBois Cook Center on Social Equity at Duke University. The gap has grown from $11 trillion in 2020, due to the disruption of the Covid-19 pandemic, he said.
Business efforts to close the racial wealth gap
JPMorgan’s Advancing Black Wealth Tour is part of a $30 billion dollar, 5-year commitment the bank made in 2020 to provide economic opportunities to Black and Latino communities. Other elements of its plans include expanding mortgage and banking access for those underserved communities.
From October 2020 through the end of 2021, JPMorgan has deployed or committed more than $18 billion toward that goal.
The bank is one of several large companies that have made similar commitments in recent years focused on closing the racial wealth gap. To name a few:
- In October, UPS partnered with the Russell Innovation Center for Entrepreneurs (RICE) to provide logistics support for Black small businesses in the nonprofit’s 4,000-person network. In 2020, UPS pledged more than $4 million to support Black non-profits and organizations.
- Salesforce sponsors a National Black Business Month Block Party Summit that offers panels and discussions about creating and scaling Black businesses. In 2020, the software giant committed to $410 million in efforts to address racial inequality and in September announced it had reached its goal of doubling Black representation in U.S leadership positions set in 2020.
- Microsoft launched its Black Partner Growth Initiative Accelerator in January to support Black tech companies and entrepreneurs, and has committed to spending $500 million with Black suppliers by 2025.
- Walmart has committed $100 million to address “systemic disparities” through its Walmart.org Center for Racial Equity. In 2021, it also announced a partnership with C2FO to provide early payments to Black and diverse Walmart suppliers to increase their working capital and help them scale up their businesses.
Darity, who is also the founding director of the Research Network on Racial and Ethnic Inequality at Duke, said such business efforts help the Black community, but fully closing the racial wealth gap requires a multi-faceted approach involving direct federal action.
Prepare for ‘a feast after the famine’
During the recent Advancing Black Wealth Tour stop in Philadelphia, bank executives and financial influencers shared the stage on a Saturday morning, offering insights to a crowd of more than 300 people. Many of the presentations focused on how attendees could preserve and build wealth even in tough economic times.
“Since the beginning of time, whenever there has been a famine, there has been a feast after the famine,” said financial coach Lynn Richardson during one of the day’s first sessions. “We have to be ready for the come up, whether the come up is in stock, whether it is in real estate, whether it is some other investment.”
In another, Milan Harris, founder and CEO of apparel brand Milano Di Rogue, shared her entrepreneurship journey. Her company started in 2012 with a single shirt and has grown into a streetwear brand with a retail location, online store and millions in annual sales, according to the company website.
“If I go to sleep with a goal, I wake up with a purpose,” Harris told the crowd,. “I want you guys to see a young black girl from the hood and know if I can do it, you can do it too.”
Financial influencer Ian Dunlap, also known as “The Master Investor,” focused on the power of investing and building wealth for future generations. Dunlap encouraged the audience diversify their finances to protect against a possible economic downturn.
“You want to get to four core investments that you want to be in,” he said during his session, encouraging attendees to create a personalized investment portfolio.
Dunlap told CNBC his goal is to break down the barriers between the Black investor and institutions.
“I want to build a financial supply chain,” Dunlap said. “If we are going to have financial freedom and financial literacy, after we make the money where are we going to take it?
“I want to rebuild the relationship between the customer and the bank or institution,” he said. “I think we’re very fractured. The big win for the long term on the institution side is to have a bigger client base that is more loyal. For the investor, less worrying and concern.”
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