LatinaLista — If there’s one stereotype about Latinos that doesn’t offend, it’s how being family-focused describes the majority of Latinos. Whether it’s sending money back home to families left behind in Central and South America or making room for elderly parents to live under the same roof with their children and grandchildren or paying for college for our children and nietos, the common belief is family comes first.
Unfortunately, putting family first today means either postponing retirement or living on a lot less in the future.
The 2014 “Hispanic American Financial Experience” study by Prudential underscores that while Latinos may act selflessly in caring and helping family members, it can be a foolhardy exercise if thought isn’t given to our own financial future.
It’s a situation that may not worry many Latinos presently but does have some analysts puzzling over the answer. George Castineiras, senior vice president of Total Retirement Solutions at Prudential Retirement, said, “One major question raised by the study is whether Hispanic Americans would plan for their retirement differently if they had access to information that could help them generate the knowledge they need to make investments decisions to secure their own and their family’s futures.”
I would venture to guess no. Because most Latino families, who are not accustomed to formal savings or investments programs, like the idea of having access to their money easily, quickly and without penalty just for those times when a family member calls for help.
Some key findings of the report are:
- Hispanics identify more as savers than investors, with 37% indicating they are more of a “saver” than an “investor.” However, nearly as many (36%) say they are “neither a saver nor an investor.”
- Survey findings reflect a cultural aversion to debt, as evidenced by 62% asserting that there is no such thing as “good debt” and 49% indicating a preference to pay cash for an item or not buy it all.
- Household expenses, health care costs, savings and debt level—all near-term concerns—are ranked as higher concerns than retirement.
- 17% of employed Hispanics are unsure of whether their employers provide matching retirement contributions, compared to 8% of the general population.
- Retirement is expected to begin at age 63 for both the general population and African American community, while surveyed Hispanics anticipate retiring at age 66 or older. Once retired, the Hispanic community plans to remain active in the workforce, with 73% indicating they may work at least part time after retirement.
- 13% of surveyed Hispanics indicated they are financially supporting someone unemployed and looking for work, compared to 7% of the general population.
- At 62%, Social Security is the highest expected source of funding during retirement, followed by personal savings (52%) and workplace retirement plans (51%). However, all three categories show results lower than the general population. Because 73% plan to continue working at least part time once retired, it is not surprising that 26% of non-retired Hispanics plan to fund their retirement with supplemental income from a job.