Social Security and Its Impact on Older Latinos

Abstract

Older Latinos have distinct demographic and economic characteristics that are making their reliance on Social Security critical. Latinos are the fastest growing segment of the older adult population. They have lower than average educational levels and higher rates of poverty than other subgroups. In addition, they have small accumulated wealth and limited retirement income. Social Security is a particularly important source of income for older Latinos because it provides many older Latinos with their sole or primary sources of income in retirement. Without Social Security, more than half of older Latinos would live in poverty. This study finds four factors that make Social Security beneficial to older Latinos: (a) lower lifetime incomes, (b) longer life expectancies, (c) higher disability incidence, and (d) higher marriage rates. Because of these factors, older Latinos receive a higher average rate of return on their Social Security contributions. The study also provides policy implications for economic security of older Latinos.