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Home Ownership is Path to Wealth

Owning a home is more than an American dream. It's the path to wealth, concludes a recent study prepared for the Consumer Federation of America (CFA).

Stephen Brobeck, CFA's executive director, believes that paying off a mortgage on a home has been, and will continue to be, the easiest way for lower income and minority households to build personal wealth.

In a comparison of households looking at home equity as a share of net wealth, home equity represented 80% of lower-income household net wealth, compared with 60% for moderate-income households, and 26% for affluent households. Most lower income and minority households hold few financial investments or retirement accounts, so they depend on homeownership to accumulate personal wealth.

This wealth gap between the poor and other Americans has led to several national savings campaigns, including the new "America Saves Through Credit Unions" program. The National Credit Union Foundation (NCUF) and CFA formed this partnership to increase the savings rates among lower-income credit union members and their communities.

The new initiative builds on the success of the national "America Saves" campaign, now in its third year, to encourage Americans to save and build wealth. Visit americasaves.org for details.