Black Women Investors Are on the Rise, Driven by a Desire to Build Generational Wealth

Black Women Investors are on the Rise, Driven by a Desire to Build Generational Wealth

J.P. Morgan Wealth Management's third annual Diverse Investor Study found that 46% of Black women respondents started investing outside of an employer-sponsored retirement plan less than five years ago, compared to 24 percent of all groups surveyed. The 2024 survey aims to uncover investing trends within Black, Hispanic, and Latino communities.

"At J.P. Morgan Wealth Management, we believe that everyone should have the opportunity to build wealth," said Plano-based Danea Rouse, Diversity, Equity & Inclusion Director at J.P. Morgan Wealth Management. "By understanding the unique needs and priorities of Black investors, our industry can better serve them and help them achieve their financial goals. This research helps us do that."

A new wave of investors

This rise of Black women starting to invest highlights the expanded access to tools and resources that have made investing more accessible. "This is very encouraging," Rouse explained. "More Black women are realizing the importance of investing as a means to help secure their financial future and the future of their families. It's not just about making money; it's about creating opportunities and breaking cycles."

Rouse emphasized that this new wave of investors is not just a fleeting trend, but a significant shift in how Black women approach their financial well-being. "We are witnessing a transformation in our communities as a result of more education and more access," she said. "There's more work to be done to make investing more inclusive, but this shows us that what we're doing is working."

Setting up the next generation

Creating generational wealth is a key driver for Black women, with nearly 70% of Black women

respondents citing it as one of the main reasons they started investing. Rouse explained, "As a Black woman who is working to build her own generational wealth, this finding really resonates with me. I'm not surprised to see it's a common priority among Black women investors. We want to give our children and grandchildren a better financial foundation than we had."

This focus on generational wealth is not just about accumulating money—it's about creating lasting legacies and doing what you can to make sure future generations are taken care of. "It's about leaving something behind that can provide stability and opportunities," Rouse said.

The study also revealed that 82% of Black respondents are contributing the same amount or more towards a 529 plan this year compared to 2023, which is 11% higher than respondents overall. "For many of us in the Black community, education is viewed as key to economic mobility," Rouse continued. "Education opens doors and creates opportunities that can help change the trajectory of a family's future."

Supporting women-owned businesses

Black women's investment choices also show their support for other women. Fifty-nine percent of Black women surveyed said it's important that the companies they're investing in are women-owned, twice as high as investors overall (28%).

"We've seen this trend across all three years of our research, and it makes me so proud," Rouse said. "When we invest in women-owned businesses, we are not just supporting individual entrepreneurs. We

are strengthening our entire community. It's about creating a network of success and empowerment."

Hands-on approach by younger investors

Younger Black investors are taking a more hands-on approach to their investing than previous generations. Fifty-two percent of Black millennial investors surveyed prefer to take an active role in selecting the stocks, bonds or index funds that make up their portfolio, compared to 45% of Black Gen Xers and boomers.

Rouse pointed out that this generational shift speaks to the growing confidence in investing among younger Black investors. "It's encouraging to see young Black investors taking charge of their financial future. They are educating themselves, seeking out resources and staying engaged," she said.

J.P. Morgan Wealth Management is committed to expanding access to investing resources and education. Its 'Building a New Legacy' series, a roadshow of local educational seminars across the country, aims to empower Black, Hispanic and Latina women and communities to learn more about investing and drive financial inclusion. Since kicking off in 2022, the series has reached over 1,800 attendees across 13 cities.

"Serving my community is at the heart of what I do," Rouse said. "We have a responsibility to provide our communities with the tools and resources they need to succeed. It's not just about financial success; it's about creating a better future for all of us."

JPMorgan Chase & Co., its affiliates, and employees do not provide tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any financial transaction.

J.P. Morgan Wealth Management is a business of JPMorgan Chase & Co., which offers investment products and services through J.P. Morgan Securities LLC (JPMS), a registered broker-dealer and investment adviser, member FINRA and SIPC.