Breaking the Cycle of Racial Wealth Inequities and Higher Education Outcomes - How Data-Driven Insights Can Inform Policy Solutions That Address the Racial Wealth Gap

Oct 15, 2026

Explores how racial wealth inequities shape higher education experiences and outcomes, linking household wealth to college savings, enrollment, completion, and student loan borrowing. Frames the relationship between higher education and the racial wealth gap as cyclical, then surveys available data on wealth and education. Quantifies the size of the gap and outlines evidence on pathways through which wealth transfers support children’s higher education. Concludes with forward-looking recommendations and data improvements.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages44

Reading Time1 h 51 min

AccessFree to download

Contributors

Acknowledgments

Identity Language

Introduction

What is the Difference Between Income and Wealth?

What is the Racial Wealth Gap?

The Cyclical Relationship Between Higher Education and the Racial Wealth Gap

How Wealth Affects Higher Education Experiences and Outcomes

How Wealth is Affected by Higher Education Experiences and Outcomes

Research Questions on Higher Education and Wealth

What Data Are Available on Wealth and Higher Education?

How Large Is the Racial Wealth Gap?

How is Wealth Associated with College Savings, Enrollment, Completion, and Borrowing?

How Wealth Transfers Are Associated with Saving for Children’s Higher Education

How Wealth Is Associated with College Enrollment

How Wealth Is Associated with College Completion

How Wealth Is Associated with Student Loan Borrowing

Looking Forward: Recommendations and Needed Data Improvements

Recommendations for Policymakers, Researchers, and Other Stakeholders

Recommendations to Improve and Expand Available Data

Conclusion

Technical Appendix

Data Sources and Methodology

Notes

BREAKING THE CYCLE OF RACIAL WEALTH INEQUITIES AND HIGHER EDUCATION OUTCOMES: HOW DATA-DRIVEN INSIGHTS CAN INFORM POLICY SOLUTIONS THAT ADDRESS THE RACIAL WEALTH GAP By Charles Sanchez, Eleanor Eckerson Peters, Diane Cheng, and Sean Tierney MAY 2024 TABLE OF CONTENTS CONTRIBUTORS ......................................... III ACKNOWLEDGMENTS ..................................... III IDENTITY LANGUAGE ..................................... IV INTRODUCTION ......................................... 1 What is the Difference Between Income and Wealth? .................... 1 What is the Racial Wealth Gap? ...................................... 2 THE CYCLICAL RELATIONSHIP BETWEEN HIGHER EDUCATION AND THE RACIAL WEALTH GAP ............................. 3 How Wealth Affects Higher Education Experiences and Outcomes ......... 3 How Wealth is Affected by Higher Education Experiences and Outcomes ... 5 Research Questions on Higher Education and Wealth ................... 6 WHAT DATA ARE AVAILABLE ON WEALTH AND HIGHER EDUCATION? ..................................... 7 HOW LARGE IS THE RACIAL WEALTH GAP? .................... 13 HOW IS WEALTH ASSOCIATED WITH COLLEGE SAVINGS, ENROLLMENT, COMPLETION, AND BORROWING? ............... 16 How Wealth Transfers Are Associated with Saving for Children’s Higher Education ........................................ 17 How Wealth Is Associated with College Enrollment ...................... 19 How Wealth Is Associated with College Completion ..................... 20 How Wealth Is Associated with Student Loan Borrowing .................. 21 BREAKING THE CYCLE | Table of Contents i TABLE OF CONTENTS (CONTINUED) LOOKING FORWARD: RECOMMENDATIONS AND NEEDED DATA IMPROVEMENTS .................................... 24 Recommendations for Policymakers, Researchers, and Other Stakeholders ............................................ 24 Recommendations to Improve and Expand Available Data ............... 27 CONCLUSION ........................................... 30 TECHNICAL APPENDIX .................................... 31 Data Sources and Methodology ...................................... 31 Table Appendices ................................................. 33 NOTES ................................................ 36 BREAKING THE CYCLE | Table of Contents ii CONTRIBUTORS Kim Dancy, Institute for Higher Education Policy Lauren J. Asher, LJA Strategies ACKNOWLEDGMENTS This research was funded through generous support from The Joyce Foundation. The findings and conclusions presented in this report are those of the authors alone, and do not necessarily reflect the opinions of the Foundation. The authors are grateful for the contributions of IHEP staff who made this report possible. Thank you to Mamie Voight, president and CEO; Kelly Leon, vice president of communications and government affairs; Lauren Bell, communications associate; Jessica Vivar, government affairs associate; and Gabrielle Smith Finnie, former research intern. They provided a range of support, including policy insight, help identifying timely and relevant research, feedback on drafts, and a host of logistical assistance throughout. This report required extensive data exploration by Netasha Pizano, former research intern; Marián Vargas, senior research analyst; Pearl Lo, former research intern, and Madeline Rowe, research intern; all of whom provided significant data validation and quality assurance support. We are grateful to Albert Liu, Jackson Miller, and Samuel Correa of Westat Insight for providing methodological feedback. We also extend thanks to Olivia Valdes of the FINRA Foundation for helping provide access to restricted-use data for some of the analyses presented in this report, Sabrina Detlef for copyediting, and openbox9 for creative design and layout. BREAKING THE CYCLE | Acknowledgments iii IDENTITY LANGUAGE In all of our work at I

FAQs

What does the report define as the difference between income and wealth?

It distinguishes income from wealth to clarify how resources stored over time—rather than earnings alone—drive educational opportunity and long-term outcomes.

How does wealth affect higher education experiences and outcomes?

The report explains that wealth influences college savings, enrollment, completion, and borrowing patterns, creating measurable differences in how students experience higher education.

What recommendations does the report make for policy and data improvements?

It provides recommendations for policymakers, researchers, and stakeholders and calls for improved and expanded data to better address and analyze the racial wealth gap.

Oct 15, 2026

Uploaded by Sophia Brooks