Survey says: Now is the ideal time to court Black investors

A recent Prudential Financial survey titled "Americans prepare for economy's next act" canvassed 4,000 employed adults on topics, trends and issues impacting their finances. Overall, the survey results underscored respondents' understandably shaky confidence in this inflationary economy. However, most Black Americans surveyed — 60% — did not share that sentiment. Rather, they indicated a growing sense of optimism and confidence on their own financial outlooks.

This insight presents an opportunity for the financial services industry to advance access to wealth creation for Black Americans, The survey suggests that building trust and using preferred channels to convey information are effective ways to engage with this community. 

Channels of engagement 
Growing financial confidence among Black Americans is inspiring them to act on seeking financial guidance, education and resources, according to the survey. Over a quarter of those surveyed (27%) currently work with a financial advisor or professional, and 22% have expressed interest in working with a financial advisor within the next 12 months. (Twenty-eight percent of all U.S. adults surveyed currently work with a financial advisor and 16% have expressed interest in working with a financial advisor within the next 12 months.)

Leveraging this interest, however, will require a nuanced understanding of Black Americans' needs, challenges and aspirations, as well as the ability to provide the tailored, value-added information they are looking for by meeting them right where they are. Importantly, the financial services industry will need to create an environment of trust and transparency and engage the community through its preferred channels. Today, that means being accessible through digital and social media. The survey found that 48% of Black Americans have received or researched financial advice on social media. Of those that did, 99% reported acting on advice. YouTube (38%) and TikTok (16%) were the most frequently used channels to seek out financial advice, according to the survey.

Building wealth
In addition to seeking advice on general financial matters, Black Americans are also focused on building wealth. For example, Black Americans' preferred investments over the next 12 months include real estate (56% reported interest), equities (51%), cryptocurrencies (47%) and fixed income products (46%) — asset categories more closely linked to wealth creation than financial tools like savings accounts and basic mutual funds.

The financial services industry now has a great opportunity to go beyond a one-size-fits-all approach to serving Black consumers.Using real data to understand their preferences will go a long way toward building the trust needed to engage meaningfully with this group. The survey suggests important guideposts for creating a sustainable approach to helping a largely underserved community put more dollars to work and to grow wealth.