Arab Americans Are High Earners - How Do They Spend It?
The Arab American community is a well-established, historical, visible, and important part of the cultural and social fabric of the United States. As a distinct grouping, there has been comparatively little social research conducted into how Arab Americans fare economically compared to other minorities. However, one thing that is clear is that Arab Americans tend to earn more and have a higher level of educational attainment than the ‘average’ American.Our own extensive research on this topic has shown a significant difference in household earnings, with Arab Americans earning thousands of dollars more, on average, than other American families. Also, Arab Americans are significantly more likely to hold a postgraduate degree than their white counterparts. While this is fairly well-documented, what is less clear is how Arab Americans spend and save their earnings.
Understanding the Numbers
It is worth examining the numbers to see what causal factors might be at play here. We are not the only publication to research this topic. News outlets such as NBC have also crunched the numbers to paint a picture of an Arab American community that is affluent, educated, and entrepreneurial. There are a number of factors that could be at play here.
For one, Arab Americans historically tend to be located in the more expensive areas of the country, such as Los Angeles and New York, where earning power is typically much higher. Meanwhile, some have argued that there is a cultural emphasis on education which may translate into the much higher numbers of young Arab Americans entering higher education which, in turn, pushes household earnings up.
An American Saving & Investing Boom
Much like many of their fellow citizens, Arab Americans are saving and investing like never before. A white-hot stock market has resulted in levels of participation in the market that is unrivaled at any other point in history. American households have saved a record-breaking $1.3 trillion over the course of the past year, with most of the biggest savers coming from the higher income groups that Arab Americans are well-represented in.
In addition, the proliferation of home investment platforms such as Infinox, which allows any American to buy and trade stocks and CFDs at the click of a button, have helped to facilitate a historical investment boom with 54% of Americans owning stock in some way. And investment platforms are aware of this heightened interest, with many offering demo accounts to let people practice before investing real money. As more Americans finally begin to save for the future in a more proactive way that extends beyond 401Ks, it will be interesting to see how evenly spread the financial gains will be.
Key Investments for Arab Americans to Consider
While the likes of Gamestop and online trading platforms have helped push retail investment to sky-high levels, these are not the only investment options that Arab Americans or others should consider. One crucial investment of education. Of course, it seems that the Arab American community already understands this, given the very high levels of educational attainment and college savings we have seen.
Another key investment is property. We are currently in the midst of an unprecedented property market boom, showing yet again that the most solid investment a family can make is in bricks-and-mortar. In the wealthy, dense urban areas where the Arab American community is most strongly represented, property prices are set to rise like never before.
Of course, these findings do not apply to the entirety of the 3.5 million-strong Arab American community. Just like any other group, there are large divergences in income and education. However, much of the community is well-positioned to take advantage of emerging trends in the financial health of all American households.
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