We were recently nominated for some industry awards! This was absolutely shocking. I have no idea who nominated us or how or why. But it instantly gave me two very strong, very different reactions.
The first was a variation on Sally Field’s Places in the Heart acceptance speech. “I haven’t had an orthodox career, and I’ve wanted more than anything to have your respect. The first time I didn’t feel it, but this time I feel it, and I can’t deny the fact that you like me, right now, you like me!” Borrowing, of course, the original speech’s explosively manic and self-congratulatory tone. We feel tremendously hashtag-blessed to have found so many warm and welcoming people in our short stay in the personal finance community. And we are truly grateful to all of our readers.
My second reaction was, “Shit. We’ve been pulling our punches!”
We should ask the hard questions
See, one of the reasons Piggy and I decided to start this blog was that too much financial advice ignored the hard questions and contentious issues that drive personal finance. Take, for example, this question: why do some people have more money than others?
There are so, so many potential answers to this question. People are different! They have different personalities, abilities, interests, advantages, backgrounds, opportunities, drives, beliefs, and knowledge sets. These combine into a set of financial circumstances unique to each individual. The personal finance community seems inclined toward examining only a few of these differences—the ones that are easy to talk about, the ones that cast a flattering light upon ourselves.
Today I’d like to torpedo all hope of winning industry awards by talking about one of the things that this community really, really doesn’t like to talk about. That subject is race, and by extension, the financial advantages of being white in a white supremacist culture.
Friends, I’d like you to extend me a little trust. Take my hand and follow me on a journey. I’m going to try to inventory some of the gifts given to me by a white supremacist culture. I didn’t ask for these gifts—there was no registry, and I will not be sending thank-you notes. But they also didn’t come with a return address, and there’s no way to refuse them. The body I was born with—that of a white woman—comes with undeniable financial advantages. And the legacy of these advantages is terrible to consider.
Let’s consider it anyway!
I was more likely to be born alive
According to data collected between 1979 and 1992, black women are 2-6 times more likely to die from complications of pregnancy. During the period of the study, there were 25.1 deaths per 100,000 black women, 10.3 for Hispanic women, and only 6.0 for white women.
Why? Well, the study’s authors aren’t entirely sure. “Quality of prenatal delivery and postpartum care, as well as interaction between health-seeking behaviors and satisfaction with care may explain part of this difference” is their best guess.
Personally, I wonder if it has something to do with the fact that doctors don’t seem to believe people of color when they describe their own physical pain. Or it could have something to do with the fact that the medical community has a long history of abusing black and brown patients. This makes people in those communities gun-shy about seeking medical assistance until it’s too late (you’d be too if your grandparents were sterilized or allowed to suffer untreated syphilis for the sake of scientific inquiry, don’t lie). It could also be because fewer people of color have health insurance, for reasons we’ll get into later.
My name is imbued with positive assumptions
The name my parents chose for me was among the top 50 most popular in the year of my birth. I’ve met many people with my name. They have all been white. There is one famous black person who shares it, but she uses a nontraditional spelling.
This doesn’t necessarily make my name a “white name.” There are no Name Police to govern such things. But it does shape the perception that someone with this name is extremely likely to be white. And that comes with many benefits.
In my youth, I was less likely than my peers with “black names” to be labeled a troublemaker by my teachers.
When I was old enough to start looking for jobs, the name on my resume would get me 50% more callbacks and interviews than equally qualified candidates with names perceived as black. No one has ever selected me for additional screening at an airport. When renting, potential landlords prefer my name over Hispanic or black-sounding names. When buying a home, I don’t face the same kind of lending segregation and vestiges of redlining that people of color deal with.
In a world where there are Beckys and there are Lakishas, I am a Becky. And I amhandsomely rewarded for it. That’s why it’s very funny to me that there are some white women who get super offended when they’re called “Becky.” However indignant one might be to feel the mild hydrogen peroxide sting of its application, a name like Becky is nevertheless an enormous net financial advantage.
My physical features are the default
I am not a stunning beauty, by any means. And the patriarchy is a tricksy beast—I suspect that very few young girls feel fully satisfied with their appearance.
Still, it was very nice that Crayola’s “flesh” crayon did, indeed, look like my flesh. It was nice to be photographed by cameras that are calibrated to my body. I loved never having to wonder if makeup would be available in a shade that suited me.
I never had difficulty finding good products for my hair, or people who know how to style or cut it. The onerous processes of braiding, relaxing, or reconfiguring hair so that it would be acceptable to my school or work dress code is totally unknown to me.
No one has ever described me as exotic. I have rarely had my skin color or eye shape compared to foods. No one ever complimented me, with surprise, on my ability to speak or think. No one has ever asked “where are you from” and expected an answer other than “Iowa.” It’s really nice that no one has ever stared at me, spoke rudely to me, or followed me because I didn’t fit their preconceived image of a welcome person.
I had no shortage of heroes
Growing up, there were lots of protagonists in television, movies, books, comics, and plays who looked like me. I never saw a beloved book character coopted into a race that wasn’t mine in a movie adaptation. (At least not that I can remember.) In my church, every painting of Jesus, the angels, and the saints made them look like my kin.
My family members never had a hard time finding dolls that looked like me. Maybe that sounds small. Maybe it is. But as far back as the 1940s, researchers have used dolls to explore absorbed racial bias in children. Black children preferred the white dolls overall, and ascribed more positive attributions such as “good” and “pretty” to them. The research concluded that such preferences were evidence of low self-esteem and learned self-hatred among black children. This self-hatred was more acute in children who went to segregated schools.
All of this damage: inflicted by the age of five.
Kenneth and Maime Clark, the researchers in this study, presented these findings in the landmark Brown v. Board of Education case. It was one of the key proofs that “separate but equal” were mutually exclusive priorities.
Tests skew in my favor
We have known for years that standardized tests and intelligence tests are inherently biased. Yet our school systems rely more than ever upon these tests to gauge school and student performance. Higher family incomes are extremely predictive of SAT scores, but race and ethnicity are even stronger predictors.
I perform phenomenally well on both standardized tests and intelligence tests. But then again, my parents were wealthy and white—so it seems I have merely conformed to statistical expectations.
Inherent biases within the language and format of these tests is partially to blame. But self-perception and fear of failure can also drive scores down. If women perform worse on science and math tests when reminded immediately beforehand of society’s low expectations for women in STEM, I find it very easy to believe the same effect can occur among students of color. Even for successful students of color, the risk of being viewed through a negative stereotypical lens can paralyze their academic successes.
Schools and communities are much more likely to inappropriately relegate bilingual students to special education programs or misdiagnose them as having a learning disability. This misalignment can permanently trap English language learners on a below-grade learning track.
My education was awesome
Efforts to integrate schools peaked before I was born, from the 1950s through the 1980s. After that, integration efforts slipped backwards due to the multigenerational efforts by American parents to keep their children from attending diverse schools. As one writer put it, the “unspoken belief that African-American and Latino children threaten the moral and intellectual development of other children has a strong emotional power that drives public education in America.”
For the first six years of my life, I went to a private Catholic school. The school was excellent. In the entire K-8 institution, there was exactly one single student who wasn’t white. He was the adopted South Asian child of two white parents.
What makes white, highly segregated schools likely to be better than diverse schools? Well, it’s complicated! There are smarter people than me who’ve dedicated their careers to studying this phenomenon. If it’s a subject that interests you, there’s tons of great research on the subject.
My community has more resources to invest in me
My parents, grandparents, and more distant ancestors struggled. But very few, if any, of their struggles were institutional in origin and universal in visitation. They weren’t subject to an intergenerational campaign of kidnapping, enslavement, rape, murder, intimidation, incarceration, violence, segregation, deprivation, experimentation, underrepresentation, appropriation, and (perhaps most gallingly, given everything else) denial.
There are very few things that investments of time, money, and attention won’t improve. Homes, schools, neighborhoods, and communities flourish with access to these things and crumble without them. And having just one of them isn’t enough.
My community hasn’t had to address the legacy of all these inequalities. That leaves them with considerably more time, money, and attention to invest in itself. And in me.
Communities of color have fewer of all three of these resources to invest. And they’ve been pretty unsuccessful at getting white communities to invest on their behalf. That’s why schools in Detroit are so dilapidated mushrooms grow in their bathrooms, mold grows on their food, and floors literally crumble beneath the children’s feet. And we don’t treat it as a national emergency.
I am well represented by being white
In the United States, white people are overrepresented in both national and local governments.
The federal government matters a lot. Why, for example, did Texas get a strong national disaster response after the recent hurricanes, but Puerto Rico didn’t? Many reasons, almost all of them to do with race.
As huge and visible as white supremacy is on the national stage, I’m of the opinion that local institutions matter more. That includes city counsels, school boards, and police departments. Ferguson, Missouri comes to mind as an example of representation imbalance and its consequences. Two thirds of Ferguson residents are black, yet 95% of its police officers are white. We all know the horrible consequences of that misrepresentation.
White people certainly can, and do, adequately represent their constituents regardless of race. But clearly there is something wrong in the dynamic of homogenized racial power. It breeds insensitivity and ignorance at best—and outright hatred and violence at worst. As a woman, an atheist, and a young person, I’m deeply underrepresented. But as a white person, I’m swimming in the invisible privileges of several hundred years of concentrated political power.
My skin color shields me from consequences
An interesting 2016 study done with eye-scanning technology proved that preschool teachers watched children of color significantly more for signs of potential behavioral issues. Further, they rated the hypothetical misbehavior of black children as less severe; counterintuitively, this was because they held these black children to lower standards. The teachers expected misbehavior, and were thus less surprised by it.
This probably explains why teachers and administrators 3.6 times less likely to suspend white children from preschool than children of color.
Unequal consequences persist long past school. Police officers are 50% more likely to let a white person slide on a speeding ticket. White offenders are significantly less likely to face arrest on minor drug charges, even though white people are more likely to deal drugs than black people. And we’ve talked before about the gross injustices in our ironically named “justice system.”
Police have pulled me over for traffic violations, but never ticketed me. I have purchased weed (or whatever the kids are calling it these days) and sold pills, but no one ever took an interest. In my wild youth I shoplifted several thousand dollars worth of merchandise. But no loss prevention officer ever looked at me twice. I’ve brought scissors on an airplane, but the airline never ejected me even put me through additional screening. I violated my school’s zero tolerance policies, but found there was tolerance after all.
My mother also never had to teach me to live in fear of such outcomes.
Being white, I have more credibility and attention as a crime victim
Conversely, if I had ever been the victim of a crime, I always knew people would believe me.*
I get to enjoy the social phenomenon known as Missing White Woman Syndrome. We are the world’s damsels, presumed to be weak, sheltered, and innocent—which makes our victimization dramatic and important.
And this is not a uniquely American obsession. A 2008 study proved that white Canadian women receive 27 times more news coverage than First Nations women—and their articles contain more images, details, and passionate statements. Crime victims who aren’t white are nearly invisible in a world deaf to their humanity and their problems.
I feel so safe in this world. Even if I’m doing dumb, bad, dangerous, or illegal things, my whiteness insulates me from consequences when others must feel their full brunt.
*So long as the crime wasn’t sexual assault, of course!
Traditional credit and lending practices statistically favor white people
The most impactful factor to your FICO score and credit score is your payment history. But this information is pulled from credit sources that white people are statistically way more likely to have. If you don’t have a house, student loans, a credit card, or a new car, your score suffers. It doesn’t matter how many months of rent, utility bills, or other non-credit on-time payments you make.
Mortgage and credit discrimination is alive and well in America. It is therefore biased to measure trustworthiness in credit. White folks are far more likely to have good credit scores and enjoy the host of financial advantages that come with them.
Bills are easier to pay when you’re white
We’re a finance blog. And lots of the stuff in this article up until this point has been somewhat squishy—proven in the lab, expressible as statistical evidence, but hard to quantify in concrete monetary terms. And while all of these factors certainly contribute to a race-based financial advantage, there’s no way to put an exact price tag on those gains.
But I gotcha numbers for this section. So hold onto your butts.
My earnings ratio is 46% higher than Latinas and 37% higher than black women. I estimate my lifetime earnings at around half a million dollars. Which means my intrinsic racial privileges have netted me an extra $185,000 to $230,000 compared to my black and brown sisters.
It’s easier to get a job when you’re white
You’ve gotten this far! So you’re probably not too surprised to learn that race plays a big hand in employment.
I endured underemployment starting in 2009. In that year, the unemployment rate for white women in my age demographic was 7.3%. For Latinas, it was 11.5% and for black women it was 12.4%.
My underemployment ended when the unemployment rate for my demographic dropped from 7.3% to 6.1%. In other words, I needed the unemployment rate in my demographic to drop by a relative 16.5% in order for me to find employment. Hispanic women did not see a comparable rebound until 2013; black women, not until 2014.
That means that if my skin were another color, I would’ve lost an additional 1-2 years of income as a result of the recession. For me, that figure came close to $25,000 to $50,000.
All told, my napkin math is this: of the $500,000 I have made in my lifetime, $281,000 is attributable to the systemic privileges that come with the color of my skin. If I were a black or Latina woman working exactly as hard, making all the same financial decisions, I might’ve made only $219,000 instead of more than twice that.
As researcher Coli Holbrook said, “I have never been so disgusted with my own data.”
Obviously this isn’t an exact number. We can’t ever know what my life would’ve been like if I were born into different circumstances. But this imperfect calculation stands as a representation of something much harder to quantify: the incredible inheritance that white supremacy has gifted me. I didn’t ask for it. It isn’t something that I want. But that doesn’t absolve me of the responsibility of dealing with it.
Where do we go from here?
I’m going to stop my list here. Not because it’s complete—not by a long shot. But because I think you all see where I’m going with this.
This is a problem.
The interesting question is, whose problem is it?
Traditionally, erasing the historic and systemic vestiges of racism in America has been the province of people of color. They’re the ones the system is disenfranchising. That makes them the ones most incentivized to do the work of real change.
But I think that’s fucked up. If you’ve been paying attention to this blog, you know we don’t cotton to this idea. We should hold responsible powerful entities for getting their shit together and changing the way the world works, even if they benefit from the status quo.
Most days I don’t feel all that powerful. But when it comes to race, I am, whether I choose to be or not. That’s why I want to be held responsible for getting my shit together and changing the way the world works. Even if I benefit from the status quo.
On Thursday we’ll be releasing a follow-up article. We’re going to talk about how we can fix this problem. And by “we,” I literally mean Piggy and I, two white women—but I also mean “all of us,” the people in the personal finance community. How can we make our community more honest and more welcoming to people with diverse experiences? And what can we do together to try to enact meaningful change? It’s an ambitious plan, but if you’ve enjoyed our tradition-smashing oeuvre up to this point, I think you’re in for a treat!
Until then, I’ll be meditating upon my blessings.