As consumers adjust to the new economic reality, they must focus on the household budget and find ways to cut expenses and debt. Each ethnic group faces unique challenges when managing money and this generalization holds true for African Americans. As a result, financial services companies will be focusing their marketing efforts on African Americans this year.
The Great Recession left nearly ¾’s of African American adults feeling as though they’ve lost financial ground. In addition, nearly half of married African American couples say the real estate crisis has negatively impacted them. A new study by Prudential also underscore that a significant number of African American women are likely to be single heads of household and therefore take on the task of financial management.
As they emerge from the recession, key financial goals for African American consumers include:
- Reducing personal debt 80%
- Saving money for retirement 82%
- Learning how to become financially stable 78%
At the same time, African Americans exhibit a lower than average rate of owning specific financial products. For example, only about 1/3rd have IRAs, own stocks/bonds or own mutual funds. A significant number of these consumers, 58%, say they do not know a financial professional they can trust.
Financial services professionals can improve their business among African Americans by promoting the values that these consumers want. This includes having high ethical standards, showing that they can help consumers meet their goals, and emphasizing that they are easy to do business with.[Source: African American Financial Experience. 2011 Prudential Research Study. Web. 29 Jun. 2011]