Creating Equity With Generational Wealth

Generational wealth is one of the key drivers to success in the U.S. And building generational wealth in BIPOC communities is one of the important steps needed to create a more equitable society and country. 

In a discussion with Audrey Cavenecia on the Unlikely Leadership podcast, Verity CEO Tonita Webb shared how critical it is for Black, Lantinx, Indigenous, and other people of color to be able to pass down businesses, property, and financial assets to their kids. The effects of slavery, the Native American reservation system, forced relocations, financial policies, and more are prominently seen in the divide between which families have "old money" that has been passed down to them, and which don't.

In the U.S., building generational wealth in BIPOC communities has been—and still is—significantly harder due to systemic barriers and past atrocities. Land and property have been physically taken, and the racial pay and job advancement gap persists. And it’s well documented that when you have wealth and privilege, you are much more likely to succeed—kids from wealthy families generally have more access to quality education and are able to start their adult lives with some money already in their accounts.

During their discussion, Tonita shared about her grandfather and how he was a role model and example for her for how to succeed. He owned a small business, a produce stand, and always encouraged her to strive for greatness, saying she was different. He planted the seed for her to be authentic and not let others diminish her worth. And she has passed this message down to her children as well, encouraging them to follow their dreams and not settling for what society says they should do.

Tonita also shared about how it’s OK to talk about money and ask questions. Often, people are afraid to bring up the topic of money, especially if they’ve had negative experiences in the past. But it should be something discussed regularly so that people can learn from each other, Tonita said. When she was young, she was nervous about going into debt because credit was considered a “bad” thing. But as she learned more about finances and building generational wealth, she realized using credit was necessary for making large purchases (like a house) or starting a business. She has passed this learning to her children, with the entire family regularly discussing their financial and life goals (both near and far) and what they need to do to make it happen. If people wait until they have enough money up front, then they lose time to build wealth, perpetuating the cycle of only people with money can continue to have money.

Additional resources:

• Generational Wealth definition (Investopedia)
• Black Workers Face Promotion and Wage Gaps That Cost the Economy Trillions (CNBC)
• What is Generational Wealth and How Do You Build It? (Young and the Invested)
• Eliminating the Black-White Wealth Gap is a Generational Challenge (Center for American Progress)