For Latinos, Retirement Years Not Always So Golden

Marvin Klotz and Aurelio Munguia both retired earlier than they had expected but for very different reasons.

Klotz, an English professor at Cal State Northridge, said he had to choose between a salary reduction and a “golden handshake.”

Munguia, a construction worker for more than 30 years, was forced to take an early retirement with limited union benefits after he found himself unable to do the work.

“My legs hurt too much,” he said. “I couldn’t stay on the ladder.”

Both men then embarked on second careers--Klotz as a tax preparer, Munguia working with his daughter in a flower shop he bought and remodeled for her. But Klotz, 71, took up this second line of work mainly to “utilize my capacities, to keep my intellect stimulated.”

The 69-year-old Munguia needed the money.

Their retirements could not be more different and clearly illustrate some of the findings of a survey on aging and retirement in Los Angeles County, released Sunday by the California Community Foundation. It is believed to be the first study on such issues among L.A. County residents 45 and older.

Of the almost 800 people who participated, Latinos were the least likely to be retired, the most fearful of retirement survival issues such as having adequate food, shelter and health care, and more likely to experience financial difficulty after retirement.

According to the survey, 42% of all respondents--but only 30% of Latino respondents--are completely or partially retired. The majority of those retired are 65 or older, and half of them live on $20,000 or less a year. The survey, conducted from Sept. 10 through Oct. 5 by the Field Research Corp., has a 4% margin of error. Some Asian Americans were surveyed and included in the “other” results category, but, according to Alan Paraccini, vice president for communications at the foundation, language barriers made it impossible to gather enough data to quantify their responses.

White and African American respondents said the main reason for retirement was the opportunity to do other things, followed by personal health. For Latinos, health was cited most often.

And although the majority of all respondents, a full 75%, said they were more comfortable than or equally as comfortable in their retirement as their parents, a quarter of all respondents reported that their financial situation was worse than they had expected, with African Americans and Latinos feeling the crunch at noticeably higher rates.

One reason for their tight finances could be the number of mouths to feed--57% of Latinos and 48% of African Americans older than 45 support at least one child younger than 18, compared with only 37% of whites.

Fully a quarter of Latino respondents disagreed with the statement “retirement is something to look forward to,” as opposed to 17% of African Americans and whites.

“A dirty little secret in this country is that one in four of the baby-boom generation will be economically at risk during their retirement years,” says Helen Dennis, an instructor at USC’s Andrus Center for Gerontology. “Most people do not work for large corporations or have pension plans.”

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And, in fact, almost half (47%) of the respondents who are not retired feel they are behind in their financial preparations, a belief shared by 52% of Latino respondents. That belief may explain why Latinos were almost three times as likely as whites and African Americans to list lack of food and clothing as a perceived likely hardship of retirement. They also were significantly more concerned about lack of housing, support from family and friends and medical attention, as well as having difficulty driving themselves.

“If you look at Southern California, the vast majority of the physical labor is provided by Latinos. So there are problems with health benefits and medical access. And if you’re standing on your feet 40 hours a day for 40 years, you are going to have health problems,” Dennis said.

Cultural predilections also have an impact.

“In the Latino community there is a greater commitment to the extended family, more children, more children living at home,” Dennis said. “So the decision to retire is not just about ‘me,’ it’s about the whole family.”

“Oh, I’ll never retire,” said Rudy Negrete, 61. “I can’t afford to.”

He did, in fact, “retire” in 1987, after 31 years with Pacific Bell. But he took the $15,000 he received in benefits and promptly added rooms to his Atwater home, which houses three of his four adult children, ages 20, 26 and 34, although all but the youngest have careers. Since then, he has done contract telephone repair work for the last nine years at City Hall.

“All my Anglo friends who retired with me are golfing. They think I’m crazy,” Negrete said. “We have no money, we’re living paycheck to paycheck and I’m glad. I made a commitment to make my life easier for my children, and I’ve got these great kids. You know that movie ‘How Green Was My Valley’? That’s us.”

Not everyone has his optimism or familial support. At 70, Yolanda Bustos of South-Central Los Angeles has found retirement very different from the life of leisure and travel she expected. A former assistant secretary, she retired eight years ago, but the death of her husband four years later left her in a financial bind.

“Everything is so expensive,” she said. “Lord, even bread, the staff of life--have you seen the prices? I don’t know how they expect you to live on just Social Security.”

A series of medical problems, including breast cancer, has left her unable to work, and she is very concerned about a recent change in her medical insurance that raised doctor and prescription co-payments.

“I just can’t afford it,” she said. “I’m on the edge now.”

Most of her friends also are widowed--according to the survey, 54% of people older than 65 are separated, divorced or widowed, including a striking 60% of African Americans.

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Bustos is a good example of why the California Community Foundation commissioned the survey.

“We decided to focus on this age group because we wanted to see if this is a more vulnerable community than the population in general,” said Jack Shakely, president of the foundation, which makes grants to a wide variety of local charities and nonprofit organizations. “And it seems to be the case. So this gives us a direction for future grant-making.”

The survey also gauged the level of community and charitable involvement among the retirement-aged and those retired, and pinpointed obstacles that might keep them from being more involved. Two-thirds of all respondents said they had volunteered in some capacity during the last year, but almost half said financial considerations kept them from becoming more involved.

Shakely plans to convene a panel of community leaders next month to discuss the implications of the results and help shape a three-year, $1.2-million grant initiative to address the needs identified by the survey.

Offering financial planning services to lower-income families might be a good place to start, according to USC’s Dennis, who also works as a retirement educator for community organizations and corporations.

“More and more, that attitude of the federal government and corporate America is that people have to take personal responsibility for their retirement,” she said. “Which means that people have to be financially literate. The irony is that the people who need the most help don’t have access to any kind of financial advice. Most people don’t work for big rich companies who can afford to bring in consultants. And you won’t see big corporations sending someone into East Los Angeles saying, ‘Let’s talk long-term goals,’ because there is no payoff for them.”

Some of the obstacles are even more basic.

“There are only a few estate planners in Los Angeles who speak Spanish,” said Shakely, which may explain why a mere 19% of Latinos reported having a will, estate plan or living trust, compared with 58% of whites and 25% of African Americans.

Knowing more about how the various communities work and think will help create programs to solve such problems, Shakely said.

“Now we know, for example, that a lot of folks live on their own, that a lot of folks are afraid of driving. So we may be looking at housing issues, at transportation issues and ways in which to bring them together and give them information.”

For the next generation, the best education may come from observing the struggles of their parents. Joe Ramirez of East Los Angeles is 42 and taking the plans for his retirement very seriously. His parents, he said, did not plan very well, and a few years ago they had to sell their East Los Angeles home and move to Texas.

“They just couldn’t afford to live here anymore,” Ramirez said. “It’s cheaper in Texas.”

His father, he said, was a butcher who moved from company to company, working for whoever offered the best wages at the time. His mother was a homemaker. Consequently, there was no pension, no 401(k), nothing but Social Security.

“I helped them for a while,” Ramirez said, “But now I’ve got my own family. It’s sad. They’ve got six grandkids here who they really miss.”

Since the move, Ramirez, who works for a store-fixture hardware company, has started some long-term savings accounts through his employer.

“My parents were a real education,” he said. “You should do these things when you’re young, but you don’t think about it. I’m thinking about it now.”

Mary McNamara can be reached by e-mail at mary.mcnamara@latimes.com.

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Latinos and Aging

Latinos face more financial and health problems during their later years than other ethnic groups, according to a Los Angeles County Aging and Retirement survey conducted for the California Community Foundation. In fact, family obligations and lack of funds often make retirement an impossibility. The complete survey results are available at https://www.calfund.org.

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Source: California Community Foundation