States with the Biggest and Smallest Wealth Gaps by Race/Ethnicity (2025)

A wide financial gulf continues to divide racial groups in the U.S., with Hispanic and Black Americans still at the bottom of the economic ladder. Non-Hispanic white Americans have a median household wealth of $250,400, compared to $24,520 for Black households and $48,720 for Hispanic households. Some key factors driving the racial wealth gap include unequal access to higher education and employment for minorities, as well as residential segregation that still persists.

In light of these issues, WalletHub measured the financial inequality among racial groups in each state and the District of Columbia. We did so by analyzing each across 21 key metrics, ranging from the median household income gap to the unemployment rate gap.

“Wealth inequality is still very prominent in America, unfortunately. For example, in the most unequal states, white people earn as much as 50%-60% more than their Black peers and are 200%-300% less likely to be unemployed or living in poverty. Combatting wealth inequality is no simple task, as it requires us to remove discrimination from education, employment and the housing market.”

Chip Lupo, WalletHub Analyst

Main Findings

Notes:
*No. 1 = Biggest Wealth Gaps
**The “Biggest Poverty Rate Gap” category describes the poverty rate of a certain ethnicity in relation to that of white people. For example, 100% would mean twice the poverty rate of white people.
***The “Educational Attainment Gap” category in this table refers to Bachelor's Degree or Higher.

In-Depth Look at the Places with the Highest Wealth Gaps

District of Columbia

The District of Columbia has the highest wealth gap in the country, which means, the seat of our nation’s government is also the most financially unequal place to live. In D.C., white people earn 64.5% more than Black people, the most disadvantaged group.

D.C. also sadly ranks first when it comes to the gap in the poverty rate, and it’s even more dramatic. Black D.C. residents have a poverty rate that’s nearly 327% higher than it is for white people. This is likely due to the big gaps that also exist in educational attainment and employment. Black people in D.C. are over 61% less likely to have a bachelor’s degree than white people, and they’re over 309% more likely to be unemployed.

There is still some good news from the District of Columbia, though. Despite its problems, it does have the lowest gap in homeownership in the country. But if other conditions in the state continue to be extremely inequitable, this divide may get worse, too.

Wisconsin

Wisconsin has the second-highest wealth gap by race. It has the second-highest gap in median household income, with white residents making around 49% more than their Black neighbors. In addition, Wisconsin has the third-largest gap when it comes to poverty. Black people, the most disadvantaged demographic, are 240% more likely to live in poverty than white people.

Wisconsin has the fifth-highest gap in homeownership as well. Sadly, Black people are over 63% less likely to own a home than white people. Part of this stems from the income gap, which obviously makes it much harder to put a down payment on a house or compete with other potential buyers in the current market. But gaps in homeownership may also be influenced by redlining or other discriminatory housing practices that still persist across the U.S.

To top things off, Wisconsin has the 10th-worst racial disparity when it comes to unemployment and 11th-worst disparity for health insurance.

Nebraska

Nebraska has the third-highest overall wealth gap, driven by the fact that it also has the highest gap in high school graduation in the country. In this case, the most disadvantaged group is hispanic people, who are over 29% less likely to obtain a high school diploma than white people.

Higher levels of education correlate with better financial outcomes, so lacking even a high school education can severely impact people’s earning potential in the future. The state also has the ninth-highest attainment gap for higher education. Hispanics and Black people are around 56% and 55% less likely to get a bachelor’s degree or higher than white people, respectively.

When it comes to the unemployment rate, Black people are in the most disadvantaged position in Nebraska, and are over 210% more likely to not have access to a job compared to white people.

Homeownership Rate Gap Over Time

Ask the Experts

In order to curb the persisting income inequality problem in the U.S., reforms must be implemented at the policy level. For additional insight, we consulted a panel of experts regarding changes that can help. Click on the experts’ profiles to read their bios and responses to the following key questions:

1. Why do you believe the racial wealth gap by race has increased tremendously in the past decade?
2. Can entrepreneurship programs for minorities help alleviate the wealth gap?
3. Should public policy focus more on racial income inequality or opportunity inequality (regardless of race)?
4. What types of programs and initiatives should public policy officials focus on to curb inequality?
5. How will inflation affect the racial wealth gap in the long run? What are the recent trends in wealth and income inequality by race?

Ask the Experts

Martha F. Davis
Distinguished Professor of Law – Northeastern University
Read More

Lori Latrice Martin
Ph.D. – Associate Dean, College of Humanities & Social Sciences and Professor, Department of African & African American Studies; LSU Faculty Athletics Representative – Louisiana State University
Read More

Gregory D. Smithers
Ph.D. – Professor of History – Virginia Commonwealth University
Read More

Luchara Wallace
Ph.D. – Associate Dean, College of Education and Human Development; Director, Lewis Walker Institute for the Study of Race and Ethnic Relations; WMU Faculty Athletics Representative; WMU Certified Cultural Competence Trainer – Western Michigan University
Read More

Dr. Tanya Golash-Boza
Executive Director – University of California Washington Program (UCDC)
Read More

Irving L. Joyner
Professor of Law – North Carolina Central University, School of Law
Read More

More Experts

Methodology

To measure the wealth gap among races in the U.S., WalletHub analyzed the 50 states and the District of Columbia across 21 key metrics, which are listed below with their corresponding weights.

Because white people comprise the majority of the American population at 63 percent, we chose this racial group as our benchmark with which to measure the gap with minority, nonwhite populations, including Black people, Hispanics and Asians. To determine the overall ranking of each state, we selected the biggest gap between racial groups for each metric. For instance, if the income gap in California is 20 percent between white people and Black people, 30 percent between white people and Hispanics and zero between white people and Asians, we used 30 percent for that metric for California. We took this approach in order to draw attention to the areas where the biggest gaps exist.

• Median Household Income Gap (Black People vs. White People): Full Weight (~4.76 Points)
• Median Household Income Gap (Hispanics vs. White People): Full Weight (~4.76 Points)
• Median Household Income Gap (Asians vs. White People): Full Weight (~4.76 Points)
• Homeownership Rate Gap (Black People vs. White People): Full Weight (~4.76 Points)
• Homeownership Rate Gap (Hispanics vs. White People): Full Weight (~4.76 Points)
• Homeownership Rate Gap (Asians vs. White People): Full Weight (~4.76 Points)
• Unemployment Rate Gap (Black People vs. White People): Full Weight (~4.76 Points)
• Unemployment Rate Gap (Hispanics vs. White People): Full Weight (~4.76 Points)
• Unemployment Rate Gap (Asians vs. White People): Full Weight (~4.76 Points)
• Poverty Rate Gap (Black People vs. White People): Full Weight (~4.76 Points)
• Poverty Rate Gap (Hispanics vs. White People): Full Weight (~4.76 Points)
• Poverty Rate Gap (Asians vs. White People): Full Weight (~4.76 Points)
• Educational Attainment Gap Among People with At Least a High School Diploma (Black People vs. White People): Full Weight (~4.76 Points)
• Educational Attainment Gap Among People with At Least a High School Diploma (Hispanics vs. White People): Full Weight (~4.76 Points)
• Educational Attainment Gap Among People with At Least a High School Diploma (Asians vs. White People): Full Weight (~4.76 Points)
• Educational Attainment Gap Among People with a Bachelor’s Degree or Higher (Black People vs. White People): Full Weight (~4.76 Points)
• Educational Attainment Gap Among People with a Bachelor’s Degree or Higher (Hispanics vs. White People): Full Weight (~4.76 Points)
• Educational Attainment Gap Among People with a Bachelor’s Degree or Higher (Asians vs. White People): Full Weight (~4.76 Points)
• Uninsured Rate Gap (Black People vs. White People): Full Weight (~4.76 Points)
• Uninsured Rate Gap (Hispanics vs. White People): Full Weight (~4.76 Points)
• Uninsured Rate Gap (Asians vs. White People): Full Weight (~4.76 Points)

Sources: Data used to create these rankings were obtained as of December 20, 2024 from the U.S. Census Bureau and the U.S. Bureau of Labor Statistics.

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