The importance of estate planning for Black families

Estate planning is crucial for Black families to secure their loved ones' wishes and build generational wealth. This proactive approach helps address historical wealth disparities and systemic injustices that have hindered wealth accumulation in the Black community.

By creating a thoughtful inheritance plan through a will or revocable living trust (RLT), Black families can combat longstanding inequalities and ensure a more equitable distribution of assets across generations. This not only strengthens financial stability but also opens up opportunities for education, homeownership, entrepreneurship, and continued generational wealth creation.

Estate planning is about more than just safeguarding financial assets; it's also about preserving cultural legacies and values. It allows families to pass down stories and traditions that contribute to the cultural identity and strength of Black communities, while also serving as a tool to mitigate historical injustices for future generations.

Historical & persisting barriers to estate planning

Historical barriers, such as lack of access to will creation, have contributed to the loss of resources for the Black community. For example, during the early 1900s, Black farmers owned 16-19 million acres of land. Today, this number has decreased, leaving fewer than 3 million acres officially under Black ownership. Many Black farmers who were set to inherit land from generations prior often lacked the documentation that illustrated the property belonged to them. Not having this record historically prevented many from having the right to make decisions regarding the land’s use and care.

While 67% of American adults don’t have an up-to-date will, an even larger number, 77% of Black Americans, don’t have one in place. There is a 29% disparity between Black and white Americans when it comes to homeownership and an even larger overall wealth divide due to various systemic issues. One barrier is redlining, which historically prevented many Black Americans from accessing credit, the effects of which can still be felt today. Another barrier is our property tax system, which widens the racial wealth gap by undervaluing Black-owned homes and placing a larger tax burden on Black homeowners.

Understandably, these issues can cause Black individuals to distrust the legal system to properly honor their wishes after they die. These factors also exacerbate the misconception that only the wealthy need an estate plan when, in reality, everyone should have a will to protect their loved ones and communities.

In addition, there are many new Black business owners: the growth rate of Black-owned businesses from 2017-2020 surpassed the number of overall new businesses during the same time frame. Estate planning is particularly important for entrepreneurs, ensuring that their assets and establishments are managed according to their wishes and that their business partners and employees are cared for in the way they intend.

There’s a misconception that individuals must hire an estate planning attorney to create their estate plan. Attorneys fees are expensive, and these prices can deter Black families from completing their wills. Additionally, Black attorneys are still heavily underrepresented in the legal space — they comprise only 5% of lawyers in the U.S., and Black individuals may not feel comfortable engaging with an attorney who doesn’t understand their cultural nuances and needs.

To address these challenges, it's essential for Black families to engage in estate planning discussions and safeguard their assets. While many might think only the wealthy need an estate plan, the reality is that everyone should have a will to protect their loved ones and communities.

How FreeWill is closing the gap

FreeWill is on a mission to raise $1 trillion for high-impact nonprofits while democratizing access to critical estate-planning documents for all Americans — specifically those who have traditionally lacked access to estate planning services.

To make estate planning more accessible, FreeWill offers intuitive resources for all Americans, including Black Americans. Our secure online will-maker guides users through the process of creating or updating their will in 20 minutes or less, free of charge. We also offer other resources — including a durable financial power of attorney and an advance healthcare directive — all at no cost, so individuals can make important financial and healthcare choices that honor their needs and values.

By embracing estate planning, Black families can take control of their financial futures, preserve cultural legacies, and contribute to the unity and purpose of their communities.