Using data from the 2006 Health and Retirement Study (HRS), this study examines what types of assets and levels of savings are held by Black near-retirees, while comparing how types of assets and levels of savings of Black near-retirees differ from those of White near-retirees. Through the use of multivariate analyses, this study further investigates the effects of being Black on the levels of savings, the likelihood of holding IRAs, and the likelihood of being financially prepared for retirement. The study sample includes 4,077 individuals between the ages of 51 and 64, and the subsamples consist of 680 Black and 3,397 White near-retirees.
Descriptive findings suggest that Black near-retirees hold lower levels of financial assets (i.e., checking accounts, CDs, stocks, bonds, and other savings) and non-financial assets (i.e., business, real estate, vehicles, and residential home) compared to their White counterparts. The descriptive results further indicate that overall, the level of net worth, holding IRAs, and the investment assets-to-net worth ratio for Black near-retirees are lower than that for White near-retirees.
The results from both the ordinary least squares (OLS) regression and the logistic regression analyses indicate that with all else being equal, being Black is a significant factor in predicting the levels of savings, the likelihood of holding retirement accounts, and the likelihood of being financially prepared for retirement among near-retirees aged 51-64. This study also explores how human capital factors and socioeconomic factors are associated with the levels of savings among Black Americans aged 51-64.
The OLS results suggest that Blacks with higher education and longer job tenure, and who are married hold higher levels of net worth than other Blacks. The logit results indicate that Black near-retirees with a college education are more likely to hold IRAs; those with longer job tenure are more likely to hold IRAs; and those in the top income quartile are more likely to hold IRAs. The findings of the logit results also indicate that Black near-retirees with some college education, longer job tenure, and those in the higher income groups are more likely to be financially prepared for retirement.