Their reality is different: On the Intersection of Racial and Financial Socialization

Financial socialization research often centers racial groups' differing financial habits and knowledge. However, little research explores the racialized experiences and understandings that influence these contrasting outcomes. Drawing on interviews with 99 middle-class Black, Latinx, and White parents, this study examines the role of racism on financial socialization resulting in two principal findings. First, this study finds that racial dynamics affect how parents strategize about financially socializing their children. Black and Latinx parents aim to prepare their children for racial-financial bias. Secondly, Black and Latinx parents often look beyond the nuclear family to financially socialize their children. These practices differ from White parents, who limited financial socialization to the immediate family and were less likely to explicitly connect race to financial socialization. These findings contribute to a more complete understanding of the intersections between racial and financial socialization.

Automated summary

Based on interviews with middle-class Black, Latinx, and White parents, this study explores the impact of racial dynamics on financial socialization. It finds that Black and Latinx parents often consider racial factors when financially socializing their children, while White parents tend to limit financial socialization within the family.