10th Annual Ariel-Schwab Black Investor Survey Shows Blacks Moving Backward, Not Forward; Leaders Convene to Take Action

Oct 11, 2007, 01:00 ET from Charles Schwab

    NEW YORK, Oct. 11 /PRNewswire-FirstCall/ -- Ariel Mutual Funds and The
 Charles Schwab Corporation released today their 10th annual Black Investor
 Survey at the first-ever Ariel-Schwab Black Investor Summit. The two
 financial services companies convened the summit in New York City at NASDAQ
 in response to the survey's findings, which show that African-Americans
 save far less money than Whites and are no more likely to be investors
 today than they were a decade ago. Panels featuring government, business,
 and community leaders covered such topics as financial literacy, the role
 of employers in promoting saving and investing, and the need for
 individuals to take greater responsibility for securing their retirement.
     "The truth is that many Americans are not saving enough to ensure a
 comfortable retirement," said Schwab Founder, Chief Executive Officer and
 Chairman Charles R. Schwab. "The problem is broad-based; but the 10th
 anniversary of this research and today's summit serve as important
 reminders that the need to better prepare for their financial futures is
 even more pressing among this underserved segment of our population."
     According to this year's just-released Ariel-Schwab Black Investor
 Survey of 500 Blacks and 500 Whites earning more than $50,000 annually, the
 median amount of money saved by Blacks surveyed is less than half of their
 White counterparts ($48,000 versus $100,000). On a monthly basis, median
 savings is $182 for Blacks versus $261 for Whites.
     The survey was first conducted by the two companies in 1998, when 57%
 of Blacks and 81% of Whites said they owned individual stocks or stock
 mutual funds. A decade later, still just 57% of Blacks are stock investors,
 compared to 76% of Whites. During the past ten years, the number of Blacks
 who own stocks or mutual funds rose as high as 74% (in 2002) only to fall
 again, while White participation has consistently hovered within a few
 percentage points of 80%.
     "The data is troubling because it suggests that barriers to investing
 are just as formidable as they were a decade ago. Our industry and our
 community must address this challenge aggressively," said Ariel President
 Mellody Hobson, adding, "Government and employers also play a crucial
 role."
     Black Retirees Need More but Save Less for Retirement
     This year, Ariel and Schwab also conducted a first-of-its-kind survey
 of middle and upper income Black and White retirees to assess their
 investing behavior and how well they prepared for retirement. The survey
 shows that retired Blacks have median savings of just $73,000 compared to
 $210,000 for Whites. Blacks, on average, also retired earlier than Whites
 (59 vs. 61) and are more likely to be relying on a pension or Social
 Security rather than a defined contribution plan, such as a 401(k) plan.
     Lisa Toppin, vice president of employee development and inclusion with
 Charles Schwab, said the retiree survey confirms that retired Blacks may be
 facing far greater financial challenges than Whites because of their saving
 and investing behavior during their working years.
     "Most Americans' first, and sometimes only, exposure to investing is
 through their workplace," said Toppin. "Employers need to find ways to get
 the message out about how to take charge of our finances, and we need to
 start building understanding and awareness at an early age."
     According to the Ariel-Schwab retiree survey, fewer Blacks than Whites
 have gone through some of the basic steps of retirement planning, such as
 calculating the amount of money they need to live comfortably in
 retirement. However, those who consulted with financial professionals were
 much more likely to have saved more than $100,000 by the time they retired,
 and were much less likely to have retired early.
     "With the right combination of planning, discipline and patience, a
 retirement goal can go from dream to reality," said Toppin.
     First-Ever Ariel-Schwab Black Investor Summit-A Call to Action
     In response to the survey's findings, Charles R. Schwab and Ariel
 Founder, Chairman and Chief Executive Officer, John W. Rogers, Jr. invited
 leaders in business, academia, government and the non-profit sector to
 discuss measures aimed at spurring wealth building and responsible
 retirement planning among African-Americans. They were joined by United
 States Treasurer Anna Escobedo Cabral, who addressed the actions that the
 federal government is taking to encourage financial literacy for all
 Americans. For the conference, Ariel and Schwab published "The Ariel-Schwab
 Black Paper: A Decade of Research on African-American Wealth Building and
 Retirement Planning." Interested parties can visit www.arielmutualfunds.com
 or www.aboutschwab.com to download a copy of the paper.
     The panelists and invited guests discussed proposals to expand
 financial literacy programs with schools and community groups and
 encouraged employers to analyze employee 401(k) participation by race. Two
 Fortune 500 companies, McDonald's Corporation and Exelon Corporation,
 shared how they took the initiative to track investment patterns by
 ethnicity, which revealed a savings gap between Black and White employees
 at their respective organizations. Exelon just recently completed the
 tracking, while McDonald's, which began this initiative three years ago,
 has subsequently enhanced its 401(k) program and increased participation
 and saving rates among all employees. Of note, African-American employee
 participation increased 21% or double the rate of White employees.
     John W. Rogers, Jr., commented, "We can no longer afford to simply
 admire this problem; it calls for action," said Rogers. "Today we took
 steps to change the course of our country's financial future and to close
 the savings gap that exists between Black and White Americans. My hope is
 that a decade from now, both Blacks and Whites will be equally well
 prepared for retirement and that there will be no need for us to continue
 this survey."
     The random sample survey of 500 Black and 500 White households earning
 over $50,000 annually is the tenth for Ariel-Schwab. It was administered by
 telephone between June 23 and July 14, 2007. The margin of error is
 approximately 4.5%. The retiree research conducted this year surveyed 300
 Blacks and 300 Whites within the first ten years of their retirement who
 earned over $50,000 annually before retiring. The survey was administered
 by telephone between June 22 and July 11, 2007. Both surveys were conducted
 by Argosy Research.
     Ariel Capital Management, LLC and The Charles Schwab Corporation are
 separate entities, but co-sponsor the "Black Investor Survey."
     Ariel Capital Management, LLC is a Chicago-based investment management
 firm and mutual fund company with over $14 billion in assets under
 management. Ariel serves individual investors through its no-load Ariel
 Mutual Funds and manages separate accounts for institutional clients.
 Ariel's web site is www.arielmutualfunds.com. Before investing, you should
 carefully consider the investment objectives, risks, management fees,
 charges and expenses. Please read the prospectus carefully before
 investing. Call 800-292-7435 for a prospectus. (C)2007, Ariel Distributors,
 LLC, 200 East Randolph Drive, Chicago, IL 60601.
     About Charles Schwab
     The Charles Schwab Corporation (Nasdaq:   SCHW) is a leading provider of
 financial services, with more than 300 offices and 6.9 million client
 brokerage accounts, 1.2 million corporate retirement plan participants,
 200,000 banking accounts, and $1.4 trillion in client assets. Through its
 operating subsidiaries, the company provides a full range of securities
 brokerage, banking, money management and financial advisory services to
 individual investors and independent investment advisors. Its broker-dealer
 subsidiary, Charles Schwab & Co., Inc. (member SIPC, http://www.sipc.org),
 and affiliates offer a complete range of investment services and products
 including an extensive selection of mutual funds; financial planning and
 investment advice; retirement plan and equity compensation plan services;
 referrals to independent fee-based investment advisors; and custodial,
 operational and trading support for independent, fee-based investment
 advisors through its Schwab Institutional division. The Charles Schwab
 Bank, N.A. (member FDIC) provides banking and mortgage services and
 products. CyberTrader(R), Inc. (member SIPC, http://www.sipc.org) is an
 electronic trading technology and brokerage firm providing services to
 highly active, online traders. More information is available at
 www.schwab.com.
     To access the 2007 Black Investor Survey, log onto
 www.arielmutualfunds.com or www.aboutschwab.com.
 
 

SOURCE Charles Schwab
    NEW YORK, Oct. 11 /PRNewswire-FirstCall/ -- Ariel Mutual Funds and The
 Charles Schwab Corporation released today their 10th annual Black Investor
 Survey at the first-ever Ariel-Schwab Black Investor Summit. The two
 financial services companies convened the summit in New York City at NASDAQ
 in response to the survey's findings, which show that African-Americans
 save far less money than Whites and are no more likely to be investors
 today than they were a decade ago. Panels featuring government, business,
 and community leaders covered such topics as financial literacy, the role
 of employers in promoting saving and investing, and the need for
 individuals to take greater responsibility for securing their retirement.
     "The truth is that many Americans are not saving enough to ensure a
 comfortable retirement," said Schwab Founder, Chief Executive Officer and
 Chairman Charles R. Schwab. "The problem is broad-based; but the 10th
 anniversary of this research and today's summit serve as important
 reminders that the need to better prepare for their financial futures is
 even more pressing among this underserved segment of our population."
     According to this year's just-released Ariel-Schwab Black Investor
 Survey of 500 Blacks and 500 Whites earning more than $50,000 annually, the
 median amount of money saved by Blacks surveyed is less than half of their
 White counterparts ($48,000 versus $100,000). On a monthly basis, median
 savings is $182 for Blacks versus $261 for Whites.
     The survey was first conducted by the two companies in 1998, when 57%
 of Blacks and 81% of Whites said they owned individual stocks or stock
 mutual funds. A decade later, still just 57% of Blacks are stock investors,
 compared to 76% of Whites. During the past ten years, the number of Blacks
 who own stocks or mutual funds rose as high as 74% (in 2002) only to fall
 again, while White participation has consistently hovered within a few
 percentage points of 80%.
     "The data is troubling because it suggests that barriers to investing
 are just as formidable as they were a decade ago. Our industry and our
 community must address this challenge aggressively," said Ariel President
 Mellody Hobson, adding, "Government and employers also play a crucial
 role."
     Black Retirees Need More but Save Less for Retirement
     This year, Ariel and Schwab also conducted a first-of-its-kind survey
 of middle and upper income Black and White retirees to assess their
 investing behavior and how well they prepared for retirement. The survey
 shows that retired Blacks have median savings of just $73,000 compared to
 $210,000 for Whites. Blacks, on average, also retired earlier than Whites
 (59 vs. 61) and are more likely to be relying on a pension or Social
 Security rather than a defined contribution plan, such as a 401(k) plan.
     Lisa Toppin, vice president of employee development and inclusion with
 Charles Schwab, said the retiree survey confirms that retired Blacks may be
 facing far greater financial challenges than Whites because of their saving
 and investing behavior during their working years.
     "Most Americans' first, and sometimes only, exposure to investing is
 through their workplace," said Toppin. "Employers need to find ways to get
 the message out about how to take charge of our finances, and we need to
 start building understanding and awareness at an early age."
     According to the Ariel-Schwab retiree survey, fewer Blacks than Whites
 have gone through some of the basic steps of retirement planning, such as
 calculating the amount of money they need to live comfortably in
 retirement. However, those who consulted with financial professionals were
 much more likely to have saved more than $100,000 by the time they retired,
 and were much less likely to have retired early.
     "With the right combination of planning, discipline and patience, a
 retirement goal can go from dream to reality," said Toppin.
     First-Ever Ariel-Schwab Black Investor Summit-A Call to Action
     In response to the survey's findings, Charles R. Schwab and Ariel
 Founder, Chairman and Chief Executive Officer, John W. Rogers, Jr. invited
 leaders in business, academia, government and the non-profit sector to
 discuss measures aimed at spurring wealth building and responsible
 retirement planning among African-Americans. They were joined by United
 States Treasurer Anna Escobedo Cabral, who addressed the actions that the
 federal government is taking to encourage financial literacy for all
 Americans. For the conference, Ariel and Schwab published "The Ariel-Schwab
 Black Paper: A Decade of Research on African-American Wealth Building and
 Retirement Planning." Interested parties can visit www.arielmutualfunds.com
 or www.aboutschwab.com to download a copy of the paper.
     The panelists and invited guests discussed proposals to expand
 financial literacy programs with schools and community groups and
 encouraged employers to analyze employee 401(k) participation by race. Two
 Fortune 500 companies, McDonald's Corporation and Exelon Corporation,
 shared how they took the initiative to track investment patterns by
 ethnicity, which revealed a savings gap between Black and White employees
 at their respective organizations. Exelon just recently completed the
 tracking, while McDonald's, which began this initiative three years ago,
 has subsequently enhanced its 401(k) program and increased participation
 and saving rates among all employees. Of note, African-American employee
 participation increased 21% or double the rate of White employees.
     John W. Rogers, Jr., commented, "We can no longer afford to simply
 admire this problem; it calls for action," said Rogers. "Today we took
 steps to change the course of our country's financial future and to close
 the savings gap that exists between Black and White Americans. My hope is
 that a decade from now, both Blacks and Whites will be equally well
 prepared for retirement and that there will be no need for us to continue
 this survey."
     The random sample survey of 500 Black and 500 White households earning
 over $50,000 annually is the tenth for Ariel-Schwab. It was administered by
 telephone between June 23 and July 14, 2007. The margin of error is
 approximately 4.5%. The retiree research conducted this year surveyed 300
 Blacks and 300 Whites within the first ten years of their retirement who
 earned over $50,000 annually before retiring. The survey was administered
 by telephone between June 22 and July 11, 2007. Both surveys were conducted
 by Argosy Research.
     Ariel Capital Management, LLC and The Charles Schwab Corporation are
 separate entities, but co-sponsor the "Black Investor Survey."
     Ariel Capital Management, LLC is a Chicago-based investment management
 firm and mutual fund company with over $14 billion in assets under
 management. Ariel serves individual investors through its no-load Ariel
 Mutual Funds and manages separate accounts for institutional clients.
 Ariel's web site is www.arielmutualfunds.com. Before investing, you should
 carefully consider the investment objectives, risks, management fees,
 charges and expenses. Please read the prospectus carefully before
 investing. Call 800-292-7435 for a prospectus. (C)2007, Ariel Distributors,
 LLC, 200 East Randolph Drive, Chicago, IL 60601.
     About Charles Schwab
     The Charles Schwab Corporation (Nasdaq:   SCHW) is a leading provider of
 financial services, with more than 300 offices and 6.9 million client
 brokerage accounts, 1.2 million corporate retirement plan participants,
 200,000 banking accounts, and $1.4 trillion in client assets. Through its
 operating subsidiaries, the company provides a full range of securities
 brokerage, banking, money management and financial advisory services to
 individual investors and independent investment advisors. Its broker-dealer
 subsidiary, Charles Schwab & Co., Inc. (member SIPC, http://www.sipc.org),
 and affiliates offer a complete range of investment services and products
 including an extensive selection of mutual funds; financial planning and
 investment advice; retirement plan and equity compensation plan services;
 referrals to independent fee-based investment advisors; and custodial,
 operational and trading support for independent, fee-based investment
 advisors through its Schwab Institutional division. The Charles Schwab
 Bank, N.A. (member FDIC) provides banking and mortgage services and
 products. CyberTrader(R), Inc. (member SIPC, http://www.sipc.org) is an
 electronic trading technology and brokerage firm providing services to
 highly active, online traders. More information is available at
 www.schwab.com.
     To access the 2007 Black Investor Survey, log onto
 www.arielmutualfunds.com or www.aboutschwab.com.
 
 SOURCE Charles Schwab