Disparities in Wealth: Analyzing the Intersection of Race, Age, and Marital Status

Background and Purpose: Wealth disparities between African Americans and White Americans persist across various demographic intersections. The wealth gap between African Americans and White Americans has been explained by income disparities and demographics, such as assessing cohabitation and marital histories. Further research is warranted to evaluate the financial benefits of marriage for African Americans. Older married African Americans are less likely than their single White counterparts to become wealthy. In this case, marital status does not overcome race as a threat to wealth accretion. Using the Panel Study of Income Dynamics (PSID) data, this study aims to assess median differences in wealth by race, age, and marital status and identify the impact of race, age, and marital status on wealth.

Methods: Data from the PSID were used. The total sample (n = 5238) included African American and White American individuals between the ages of 24 and 62 who were either married or never married. All analyses were run using SAS On Demand and R Studio. The initial analysis was conducted in three steps. First, a descriptive analysis was performed to examine sample characteristics and variables within the model. Next, a Kruskal-Wallis test assessed differences in medians with nonparametric data. Last, a Dunn’s test was performed to determine which pairs of groups have significantly different medians. Multiple regression analyses were performed to determine each variable's impact on wealth.

Results: There were significant median differences in wealth by race, χ2(1) = 1099.9, p < .001, age χ2(3) = 463.25, p < .001, and marital status χ2(1) = 1523.7, p < .001. The full regression model was significant, (F = 149.7, p < .001). Findings revealed that older age is associated with increased wealth but not for older (55-62) African Americans who have never married, and being married overwhelmingly increases wealth. However, the increase is most impactful for White Americans.

Conclusions and Implications: Aligned with prior research, the findings indicate that African Americans enter adulthood with less wealth and accumulate wealth more slowly as they age compared to their White peers. The models explain only modest variances in wealth, suggesting that other unmeasured systemic and historical factors play a significant role in wealth disparities. Further research on wealth-building barriers for African Americans should inform the development of policies and programmatic interventions to decrease the wealth gap in America.