Columbus, OH–(HISPANIC PR WIRE)–March 28, 2007–According to a new study released by Nationwide Financial (NYSE: NFS), nearly two-thirds of retired Hispanic women say they were driven into retirement by factors beyond their control.
Sixty-three percent of the Hispanic female retirees polled said they retired when they did due to illness, disability, company closure or other reasons not of their choosing. This figure is almost twice as high as for the population in general (35 percent) and more than double the rates of African-American and Asian-American women who reported in the affirmative, at 28 percent and 31 percent respectively. Only African-American males reported a higher rate, at 73 percent, according to the same study.
“The research found that Hispanic women retirees often do not have the ability to choose when they want to retire, which reinforces the fact that it’s never too soon to prepare for retirement, especially when it’s unexpected,” said Gordon Hecker, senior vice president at Nationwide Financial.
Hispanic women may face an uncertain retirement for other reasons as well. The Nationwide Retirement Decisions Study, conducted with Mathew Greenwald & Associates, also found that most Hispanics expect to retire between the ages of 57 and 65.
That’s significant because other expert research indicates that Hispanics tend to rely heavily on Social Security benefits as the main source of income during retirement. The Pew Center for Hispanic Research found that half of Hispanics between 55 and 59 years of age have no retirement savings and that Hispanics have a very low participation in employee-sponsored retirement plan.
These practices could affect how comfortably the group retires, especially considering that recent legislation mandates that the normal retirement age will increase from age 65 to 67 in 2027. As a result of the legislation, benefits for those retiring early at age 62 could be reduced by 30 percent(1).
The survey also revealed that 65 percent of Hispanics – more than any other group – responded that they have filled out a retirement worksheet to calculate how much income they would need in retirement. The study shows that the majority of Hispanics surveyed estimate needing $3,000 per month or less to maintain their lifestyle in retirement, compared with 42 percent of the general population that responded they’ll need less than $3,000.
“The study demonstrates a very encouraging trend – Hispanics are putting pen and paper together to figure out what they need to accumulate for a good retirement. But to reduce the challenges that come with an unexpected early retirement, it is important that the population also starts saving and planning accordingly,” said Mathew Greenwald, principal of Mathew Greenwald &Associates.
Most experts agree these three points should be considered when planning for retirement:
— Start saving now: Prepare for the unexpected and rising costs of living by saving as early as possible. Even a small amount each month can make a difference in the long-term.
— Assess your readiness: Use available worksheets and online tools to estimate how much you need to fund your retirement and take stock of all your possible sources of income.
— Explore options: Evaluate different savings sources to help prepare for the future such as employee-sponsored 401k plans, pensions, and other. Consult with a professional that can guide you and explain the different options.
Other key findings from the survey include:
— Hispanic women make a large portion of financial decisions or participate equally with their male counterparts (72 percent) in financial decisions.
— Hispanics also rate being able to stay in their home after retirement and not having to sell the family home for financial reasons as one of the most important goals (84 percent) in retirement decisions.
— Another important factor for Hispanics is the ability to care for children and grandchildren, with more than half (57 percent) of survey respondents stating they would like to offer the help if needed.
This research is a continuation of Nationwide Financial’s commitment to help empower consumers, regardless of income or financial sophistication, with clarity around the path to retirement. The company recently launched RetirAbility CheckSM, a free online resource that provides users with a simple, fun and engaging way to measure their retirement readiness. Visit www.nationwide.com/RetirAbilityCheck for more information.
About Nationwide Financial(R)
Nationwide Financial Services, Inc. (NYSE: NFS), a publicly traded company based in Columbus, Ohio, provides a variety of financial services that help consumers invest(2) and protect their long-term assets, and offers retirement plans and services through both public- and private-sector employers.
It’s part of the Nationwide group of companies, which offers diversified insurance and financial services. The group is led by Nationwide Mutual Insurance Company, which is ranked No. 98 on the Fortune 100 based on 2005 revenue.(3) For more information, visit www.nationwide.com.
Nationwide, the Nationwide Framemark and Nationwide Financial are federally registered service marks of Nationwide Mutual Insurance Company.
1. Monthly Labor Review, February 1990
2. Nationwide Investment Services Corporation, member NASD. In MI only: Nationwide Investment Svcs. Corporation.
3. Fortune Magazine, April 2006
(C) 2007, Nationwide Financial Services, Inc. All rights reserved.