A recent article that was published in the Intersections South LA blog for the USC Annenberg School of Communication & Journalism, pointed out the large percentage of Latinos not investing in their retirement.
With a growing concern for the future of the economy and job crisis, many Latinos have turned to traditional methods of savings vs. investing the money in accounts such as a 401K or annuity. As reported by the Pew Research Center, 66% of Latinos wealth dropped (2005-2009) by far the biggest among others with Whites at 16% and African-Americans at 53%.
“I don’t trust that my money will be there for me at the end,” says Obdulio Hernández. “I’m afraid of the risk. What if the company goes bankrupt? Then I’ll have nothing!” he exclaims. “Maybe if I understood how the plan works, I’d be willing to invest,” he says referring to retirement plans.
Many first generation Latinos such as Mr. Hernandez feel the same way about investing into a retirement account. The fact is that with more Latinos becoming unemployed or having to take a wage decrease, it causes them to save less. For those Latinos who are not first generation like myself the fact of planning for my retirement seems far fetched as well. I do have a 401K but are often concerned that much of my savings will be depleted due to negative changes in the economy. Nonetheless planning for the future is something that should definitely be accounted for.
Many latinos refuse to invest in a retirement account due to the lack of knowledge of having a 401K. Bank institutions should reach out to this segment of the population to help them better understand their retirement options for the future.
A great resource I found to learn more information on how you can invest in your retirement was a website called 401K Latino. In it you will find great resources and links to help you invest in your future. The best thing about it is that its bilingual!