State Farm study
reveals different attitudes on financial security by women of color
(March 15, 2013) A newly released study from The State Farm Center for
Women and Financial Services at The American College shows how
differently women of color gauge their financially security compared to
women in the general population.
The pressure to pay off debt amid the challenge of meeting their own and
their family's immediate needs are key challenges preventing many women
of color from saving and building cash reserves.
These trends are common among the general population of women who,
despite using a variety of approaches to meet their financial goals,
still don't feel financially secure. The report titled "Survey on the
Financial Needs & Attitudes of Women of Color" polled 3,000 Asian,
Hispanic and African American women ages 25 to 75, along with a
comparison group representative of women in the general public.
"Our research uncovered the key roles a systematic savings plan and cash
reserves play in the financial security and stability of women of
color," said Professor Mary Quist-Newins, Director of The State Farm
Center for Women and Financial Services at The American College. "Women
don't need to choose between saving and paying off debt -- they must do
both to build a stronger and brighter long-term financial future for
themselves and their families."
The lack of cash reserves exists across all income levels, hitting
middle-income households the hardest. The survey found the presence of
cash reserves are generally correlated with income and women who
reported annual household earnings of more than $80,000 are more likely
to have these funds.
How secure do you feel in your current financial situation?
Among the noteworthy findings on African American women were these:
While African American women report feeling the least financially
secure, they are also the most hopeful about the future. Only 18 percent
of African American women with incomes of $45,000 to under $75,000 feel
extremely or very secure, significantly less than the average American
women in the general population, who are predominantly Caucasian (26
percent) or Asian women (28 percent) with the same income.
Yet, 74 percent of African American women expect a brighter financial
future as compared with 56 percent of women in the general population,
48 percent of women in the Asian population, and 62 percent of women in
the Hispanic population.
To determine their economic priorities, respondents are asked to rank
the importance of a wide range of financial issues:
Debt: The need to reduce debt trumps other financial goals,
including saving in general and for retirement. Overall, three--‐quarters
of women say reducing or eliminating debt is a high priority, and this
is most often named the top priority by women of all racial or ethnic
African American women (83 percent) are more likely than Hispanic (78
percent) and Asian women (70 percent) to call dealing with debt a high
The proportion of African American women citing this as a priority is
high, even among those with incomes of $75,000 or more (85 percent).
Retirement: Following closely after debt reduction, nearly three
in four women say investing for retirement is a high financial priority.
African American women (74 percent) were more likely to place an
emphasis on retirement savings than women in the general population
(predominantly Caucasian, 73 percent).
Cash Reserves: A majority of women report that they are focused
on saving for an emergency and growing their cash reserves.
More so than women overall, African American (79 percent) and Hispanic
(75 percent) women say that one of their high priority goals is simply
to build up their general cash reserves. These differences are evident
regardless of income level.
Protection Planning: Few view adequate insurance coverage as
their top priority, but about six in ten women agree that having enough
insurance to protect what is important to them and their family is a
African American women (67 percent) are particularly likely to report
that having adequate insurance is a high priority for them, driven
largely by those with incomes of $45,000 to $75,000 who feel this is
important (65 percent) and those ages 55 and older (77 percent).
survey was conducted by independent market research firm Mathew
Greenwald & Associates, Inc. on behalf of The American College’s State
Farm Center for Women and Financial Services. Responses were gathered
through an online survey with a total of 3,000 women, including 2,250
interviews with Asian, Hispanic and African American women, plus a
comparison group representative of 750 women in the general public.
All of the participants selected were ages 25 to 75 with household
income of at least $45,000. Interviewing took place September 4 to 19,
2012. The data was weighted by age and education to reflect the total
population of women ages 25 to 75 with household income of at least
$45,000. General population and minority women were weighted separately.
If this study were a random survey of 750 women, it would have a margin
of error (at the 95 percent confidence level) of plus or minus 3.7
To view the results of the entire study,
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