Consequently, more than one in four age 65 and up relies almost exclusively on Social Security for living expenses in retirement, according to a report released Thursday.
In 2008, the report said, 26 percent of Latinos 65 and older had no income other than Social Security, and for another 7 percent, the government benefit made up 90 percent of their income.
"Social Security is currently the only robust, reliable source of retirement income for low-income workers, underscoring the importance of ensuring the program's viability for current, future and retired Latino workers," said institute Executive Director William A. Vega, who coauthored the report with fellow Zachary D. Gassoumis.
Primers cover Asians, African Americans, Latinos
Titled "Impact of Social Security and Proposed Benefit Changes on the Latino Population," (PDF) the report was commissioned by AARP. It was the third primer examining the importance of Social Security benefits among certain ethnic groups. The other two focused on Asian Americans and African Americans.
The report pointed out that though Latinos now number about 50 million and are the fastest-growing ethnic population in the United States, the proportion eligible for Social Security benefits is lower than in other groups. That's because the Latino population is relatively young, which means Latinos will be contributing to Social Security for years to come. Many won't begin receiving benefits until the second part of the century.
Citing U.S. Census data from 2004, the report noted that Latino mothers were less likely than white mothers to return to the labor force even a decade after their children were born.
Latino mothers face problems
As a result, many may have to rely heavily on Social Security to make ends meet when they retire because they won't have employer-sponsored 401(k) plans or other savings to fall back on.
And that could be a problem — retirees in certain cities already find that their Social Security benefit falls short of basic needs.
In Los Angeles and New York City, both of which have higher than average proportions of Latino residents, the average monthly Social Security retiree benefit in 2008 was $1,018 for Latino men and $795 for women. But in 2009 just the rent for a one-bedroom apartment was higher than those payouts — an average $1,061 in Los Angeles and $1,195 in New York, the report said.
"The promise of retirement security that Social Security provides for millions of Americans today is particularly significant to Latinos, both now and in the future, as demonstrated by this important research," AARP board member Fernando Torres-Gil said in a statement.
The report "underscores the need for our elected officials to consider what impact any proposed changes to the program will have on all Americans as they work to strengthen retirement security for future generations."
Carole Fleck is a senior editor at the AARP Bulletin.