Latinxs are living longer but saving less
Retirement planning causes many Americans anxiety, but Latinx individuals may face some unique challenges. A recent study by the Urban Institute found that Latinx retirees have 70% less saved on average than their Caucasian counterparts. Besides having less saved, Latinx people are outliving the overall population, which means more years in retirement. We all struggle to save for retirement, but why is it extra challenging for this community?
Many depend on family for financial support
There are some cultural norms that may be causing Latinx individuals to save less for retirement, like relying on family for financial and healthcare support. It’s not uncommon to see Latinx families living in multigenerational households, meaning that grandparents, parents, and children are all under one roof. The expectation that in retirement you will live with family causes some individuals to save less (or not at all) for things like assisted living or senior housing facilities.
Living with family can help ensure that you’re taken care of, but by saving enough for retirement, you could also be able to chip in for household expenses or an in-house caregiver when you’re older. This would allow you to be with family without inconveniencing them financially. By preparing for retirement early, you can lift some of the burden from your family’s shoulders and enable them to pursue their own financial goals.
Financial expectations in retirement may be lower
When many Latinx individuals think about retirement, they aren’t thinking about luxurious vacations around the world but time spent at home with family. Having lower financial expectations for retirement may be another reason why Latinx people are saving less.
Every person should set their own goals and expectations for retirement. However, keep in mind that each year things get more expensive with inflation. Even if you do plan on enjoying a humble retirement, things will be more expensive down the line. That’s why preparation is important.
Workplace hurdles to overcome
When it comes to saving, there can be some major hurdles within the workplace for Latinx individuals. Another study done by the Institute of Social Research found that Latinxs get up to 24% fewer callbacks from employers when job searching, which leads to higher unemployment rates and less leverage when negotiating salary. There is also drastically less access to workplace 401(k) plans and financial education among this community.
MoneyLion is dedicated to helping all Americans achieve their financial goals. With MoneyLion, you can get anytime access to 0% APR Instacash advances with no monthly fee. Plus we offer easy ways to bank and invest, and powerful credit builder loans up to $1,000. All with no credit check.
Start preparing for retirement
The first step in preparing for retirement is to set a goal for yourself. Experts usually estimate that retirees will spend about 70% of their current salary per year in retirement, and the average person is retired for 18 years. If you multiply 70% of your current salary by 18, you will get a rough estimate of what your savings should be at the time of retirement.
Don’t let the amount daunt you. It’s important to understand that the sooner you start saving, the more your money can grow through compounding interest. If your employer offers a 401(k) plan, start setting aside money directly from your paycheck. Check with your employer to see if they match employee contributions, which will add even more to your savings. If your employer doesn’t offer a 401(K), then you may consider establishing an Individual Retirement Account (IRA) to build your own savings.
If spending retirement with family is your goal, imagine how much better it will be with the right preparation.
Community Posts
Similar Posts
Disclosures
Instacash® is an optional service offered by MoneyLion. Your available Instacash Advance limit will be displayed to you in the MoneyLion mobile app and may change from time to time. Your limit will be based on your direct deposits, account transaction history, and other factors, as determined by MoneyLion. Expedited delivery requires Turbo Fee. See Instacash Terms and Conditions for more information and eligibility requirements.
Credit Builder Plus membership ($19.99/mo) unlocks eligibility for Credit Builder Plus loans and other exclusive services. This optional offer is not a Pathward product or service. A soft credit pull will be conducted which has no impact to your credit score. Credit Builder Plus loans have an annual percentage rate (APR) ranging from 5.99% APR to 29.99% APR, are made by either exempt or state-licensed subsidiaries of MoneyLion Inc., and require a loan payment in addition to the membership payment. The Credit Builder Plus loan may, at lender’s discretion, require a portion of the loan proceeds to be deposited into a reserve account maintained by ML Wealth LLC and held by Drivewealth LLC, member SIPC and FINRA. The funds in this account will be placed into money market and/or cash sweep vehicles, and may generate interest at prevailing market rates. You will not be able to access the portion of your loan proceeds held in the credit reserve account until you have paid off your loan. If you default on your loan, your credit reserve account may be liquidated by the lender to partially or fully satisfy your outstanding indebtedness. May not be available in all states. Credit Reserve Accounts Are Not FDIC Insured • No Bank Guarantee • Investments May Lose Value. For important information and disclaimers relating to the MoneyLion Credit Reserve Account, see Investment Account FAQs and FORM ADV.
Investment advisory services provided by ML Wealth LLC. Investment Accounts Are Not FDIC Insured • No Bank Guarantee • Investments May Lose Value. For important information and disclosures relating to the MoneyLion Investment Account, see Investment FAQs, Form ADV Brochure, and moneylion.com/investing. Accounts are subject to a monthly account fee of $1, $3 (accounts valued over $5,000), or $5 (accounts valued over $25,000).
MoneyLion does not provide, nor does it guarantee, any third-party product, service, information, or recommendation. The third parties providing these products or services are solely responsible for them, as well as all other content on their websites. MoneyLion is not liable for any third party's failure with regard to those advertised products, services, and benefits. These advertised products and services may not be FDIC insured or bank-guaranteed, and may be subject to a different privacy policy than MoneyLion’s. You should check individual offers, products, and services to become familiar with any applicable restrictions or conditions that may apply. MoneyLion may receive compensation from third parties for referring you to the third party, their products or to their website.
Instacash is a 0% APR cash advance service provided by MoneyLion. Your available Instacash advance limit will be displayed to you in the MoneyLion mobile app and may change from time to time. Your limit will be based on your direct deposits, account transaction history, and other factors as determined by MoneyLion. This service has no mandatory fees. You may leave an optional tip and pay an optional Turbo Fee for expedited funds delivery. For a $40 Instacash advance with a Turbo Fee of $4.99, your repayment amount will be $44.99. Generally, your scheduled repayment date will be your next direct deposit date. An Instacash advance is a non-recourse product; you will not be eligible to request a new advance until your outstanding balance is paid. See Membership Agreement and help.moneylion.com for additional terms, conditions and eligibility requirements.