No, Teaching Brown And Black People Financial Literacy Is Not The Solution To Poverty

It's not financial literacy we need — it's better economic policies.

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As the founder and Executive Director of a financial literacy education non-profit, I’m very much an advocate for financial literacy. Studies show that teaching youth financial literacy before entering college is crucial to achieving financial security and success later on in their lives. 

As someone who grew up low income in one of the poorest parts of NYC to an immigrant parent, I know personally the importance of financial literacy. Financial literacy empowers people to make smart decisions and invest their money in the right ways. It can also save you from making bad decisions and being pressured into scams or debt that can potentially ruin your finances. 


But financial literacy is just a band-aid solution that masks deeper problems.

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Dave Ramsey, a renowned finance expert recently said on Fox News, “You have a career problem, you have a debt problem, you have a relationship problem, you have a mental health problem, or something else is going on if $600 changes your life," bashing the idea that a stimulus package will help Americans at this time. 


Ramsey is missing the point and blaming poor people for their own situations. One of the biggest things I’ve learned about financial literacy is that it’s absolutely essential and carries with it a lot of great benefits, but it’s not the solution to the bigger problem: the racial wealth gap and poverty. 

The racial wealth gap is the gap in wealth between Black and white households, with white households having a net worth of $171,000 and Black households just $17,150 in 2016. 

Years of redlining Black and brown neighborhoods, predatory lending, and more have caused the widening of the racial wealth gap to occur. Black and brown communities have been economically disenfranchised because of historical discriminatory policies (such as the Home Owners Loan Corporation Act of 1933) and still experience the effects today. 

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People who don't earn a living wage can budget all they want, but if all they have left to their name is a few dollars for food after taxes, rent, and transportation bills, financial literacy won't change that.

Financial literacy has always been helpful for social mobility, but it is not the solution to overcoming the racial wealth gap and poverty. 

Saying the Black and brown people need financial literacy ignores the history of economic discrimination marginalized groups have faced.

More importantly: it creates a backward narrative that the root of poverty in Black and brown communities is ignorance when really it’s years of discriminatory policies that have kept our communities from economic and social mobility. 


One of the solutions that are really going to change the game is passing laws that require businesses, companies, and organizations to pay a living wage in each state, including paying their interns a living wage. 

Another potential solution is eradicating the trillions of dollars in student loans in the U.S., especially in seeing that Black and brown students tend to borrow more due to lack of generational wealth. 

There are other more effective solutions at closing the racial wealth gap and lifting communities out of poverty than teaching financial literacy.

This is not to say financial literacy is useless; it’s absolutely essential. But policies that uplift Black and brown communities economically are just as critical.


Let’s change the narrative that Black and brown communities are the cause of their own poverty because it’s absolutely just not true. 

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Angelique Beluso is a sex educator and writer who covers feminism, pop culture and relationship topics. Follow her on Instagram @ArtistNamedAngelique.