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Older African Americans Rely On Social Security As Primary Source Of Retirement Income

New York – Nearly 80 percent of African Americans who are age 65 and older that receive Social Security depend on it for 50 percent or more of their income, according to a new report by AARP’s Public Policy Institute. The report is second in a series of three reports analyzing sources of retirement income among minorities and women.

While the financial security of persons over 65 has improved collectively over the last 30-plus years, this improvement does not apply to all minority groups, including African Americans. In 2005 while older African Americans accounted for 8.4 percent of the over-65 population, but 19.3 percent of those over 65 living in poverty. For nearly half (44.3 percent) of older African Americans, Social Security is their sole source of income.

“Nearly 75 million working Americans do not have a way to save or plan for their retirement,” says H. Carl McCall, former New York State Comptroller and currently the volunteer chair of the AARP New York’s Economic Security Campaign. “While we, as a country, have made great progress over the last several decades to educate individuals about how to plan for retirement, new steps must be taken to increase the financial security of all Americans as we get older. Solutions are on the table – including ways to increase financial literacy and opportunities to save, including automating 401(k) accounts and instituting Auto IRA accounts for those without any way to save.”

With traditional defined benefit pensions on the decline, and half of the working American population without access to any employer-based retirement savings mechanism, Social Security is the only source of income for many older African Americans.

“Further steps must be taken to educate African Americans about their options for saving and steps must be taken in the workplace so they have all the resources available to do so,” says McCall.

Auto IRA legislation has been introduced in the Senate by Senators Jeff Bingaman (D-NM) and Gordon Smith (R-OR). Companion bipartisan legislation has been introduced in the House by Representatives Richard Neal (D-MA) and Phil English (R-PA).

The bill would provide employees with direct-deposit payroll deductions to an IRA at a financial institution, and is focused on employers with more than 10 employees and that have been in business for at least two years but do not offer a retirement plan. The employer would not have to contribute to such an account, nor would they hold any liability for investment decisions.

McCall will be working with AARP New York advocating on behalf of automatic savings mechanisms and educational campaigns related to financial security. McCall served as Comptroller of the State of New York from May 1993 to December 2002 and serves on numerous corporate boards. He is presently a principal of Convent Capital, a financial services advisory firm.

For more information about how to save for retirement, apply for public benefits, or this AARP Public Policy Institute report, please visit

AARP is a nonprofit, nonpartisan membership organization that helps people 50+ have independence, choice and control in ways that are beneficial and affordable to them and society as a whole. AARP does not endorse candidates for public office or make contributions to either political campaigns or candidates. We produce AARP The Magazine, published bimonthly; AARP Bulletin, our monthly newspaper; AARP Segunda Juventud, our bimonthly magazine in Spanish and English; NRTA Live & Learn, our quarterly newsletter for 50 + educators; and our website, AARP Foundation is an affiliated charity that provides security, protection, and empowerment to older persons in need with support from thousands of volunteers, donors, and sponsors. We have staffed offices in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands.

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