Growing Number of Ethnic Elders in Financial Crisis


Written by Paul Kleyman of New America Media

In a dismal week when the most positive economic news for the United States was Friday’s federal data showing anemic employment gains, the plight of ethnic elders looks “even worse than we thought it would be,” according to Henoch Derbew, coauthor of a new report, “The Economic Crisis Facing Seniors of Color.

“While the recession has affected all American, the effects have been truly devastating for Latinos, African Americans and Asian Americans hoping to retire with some dignity,” said Preeti Vissa, director of community reinvestment at the Greenlining Institute in Berkeley, Calif., which released the study Friday.

At a time when Congress and the president are considering cuts to Social Security, Medicare and Medicaid, she said the report shows that federal and state governments need to take steps to protect lower-income seniors and “to immediately take off the table any proposal that will plunge our most vulnerable elders into poverty.”

Key Findings

Among the report’s findings are that:

Even before the 2008 recession, a key study found that 91% of African American and Latino seniors are financially vulnerable, while overall figures showing lower poverty levels for older Asian Americans “mask hidden pockets of poverty,” such as among Hmong, Korean or Cambodian seniors;

The Federal Poverty Line fails to consider factors, such as the high costs of health care, housing and transportation for seniors on fixed incomes;

Seniors of color have become increasingly reliant on Social Security as they have tapped out their modest savings and employer-based pensions have dwindled in the past 30 years to just over one-in-three African Americans and slightly more than one in five Latino workers.

• The foreclosure crisis has disproportionately affected black and Latino families, draining over $213 billion in wealth from these communities—almost half of the losses to subprime borrowers nationally.

The disproportionately high levels of poverty and near poverty among ethnic seniors will be of growing concern nationally, because they will double by mid-century to four in ten seniors. In the Golden States alone, according to the report, “by roughly 2025, the majority of California’s seniors will be people of color.”

Because the federal poverty line, which is based on a half-century old formula, doesn’t account for significant living costs for elders, the Greenlining report calls on state and federal governments to develop and use more accurate poverty-measurement tools, such as the Elder Economic Security Standard Index (the Elder Index) developed by the University of Massachusetts, Boston, and Wider Opportunities for Women.

When UCLA’s Center for Health Policy Research applied the Elder Index to every California county (using 2006 census data), it found, for instance, that seniors in Oakland and other parts of Alameda County, needed $25,000 a year on average just to cover essential expenses – not the federal poverty figure of $10,210.

The report cites research showing, “The current financial vulnerability of seniors of color, both nationally and in California, has its roots in a longstanding racial and ethnic wealth and asset gap stemming from a variety of factors, including different initial wealth endowments and outright discrimination.”

For example, data from the Corporation for Enterprise Development reveal that “median net worth for minorities in California was $51,000 in 2006, compared to $304,982 for whites.” The report emphasizes, “These gaps are not going away; in fact, they are growing.” Declining household wealth since the recession started will make retirement an even more difficult goal as ethnic boomers pass the milestone age of 65.

How to Close Income Gap

Among solutions to the widening income-security gap for ethnic elders, the reports recommends:

Protect the social safety-net program, such as Supplemental Security Income, food stamps and adult day health care centers from budget cuts, “which may bring heavy burdens for seniors, and often ultimately higher costs for state and federal governments”;

Lift asset limits that currently force poor seniors to “spend down” their savings before they can participate in Medicaid, cash assistance or other programs, thus evaporating even small retirement savings;

Increase access to employer-matched and tax-deferred savings and pension plans for people of color and low-income groups, as well as special retirement accounts set up to help worker save automatically, regardless of whether their employers offer pensions;

Better protect senior’s limited assets with stronger banking and lending regulations and consumer protections, such as curb the abusive practices of payday lenders, “which tend to cluster in communities of color.”

The report notes, “California is home to large groups of immigrants from more than 60 nations, and no race or ethnic group constitutes a majority of the state’s population.”

The study’s author’s call for great efforts to develop cultural competency in healthcare and related services to provide diverse patients with high-quality care that is safe, equitable and focused on patients and their family caregivers.

“Currently, disparities pervade healthcare to the point that healthcare is fundamentally unequal,” says the study. “For seniors of color, language and cultural barriers form distinct challenges for a population that often needs complex, intensive healthcare services; an adequate force of healthcare workers with appropriate language and cultural skills will be essential.”

This post was originally published by New America Media.

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Photo from Bob Jagendorf via flickr creative commons

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K s Goh
KS Goh4 years ago

Thanks for the article.

Tom Sullivan
Tom C Sullivan4 years ago

It is all races that are hurting, seniors are being shafted everyday, we deserve to have a good life also. It is not just one or two races , it is all seniors.

Lynda H.
Lynda Harrison4 years ago

While it is a sad commentary on this country that certain Ethnic elders are struggling, many of us are tired of this racist rhetoric implying that they are the only ones who deserve assistance. Apart from the rich who have been amply rewarded by RePUBICan lawmakers and their colleague who currently lives (rent-free, no doubt) in the White House, everyone is suffering the impact of the financial meltdown exacerbated by successive Government policies that favor the haves amongst us.

Dianne Robertson
Dianne Robertson4 years ago

All elderly are "going without". In my assisted living in rural Northern Minnesota ladies make sandwiches of half their meat and their slice of bread. They claim thats all they 'care for' for supper.They accept a carton of milk then give it to a friend "who likes milk".Our facility has 37 apartments --maybe 50 residents.They serve three meals a day (at $4.00 each, payable with your next months rent ) Very few eat three meals a day in the dining room. Our prevailing ethnic group is from FINLAND so we are about as white as we can get. the problems are universal.Social security checks haven't seen a cost of living raise in several years altho the cost of EVERYTHING ELSE HAS. Medicare payments come out of Social Security checks before we see them,and many of us have supplimental insurance payments to cover the 20% of medical bills that SocialSecurity doesn't pay. Eldery people have ,for the most part ,always tried to be responsible people.We've worked, raised families and saved.Unfortunately,what Grandma has left to take care of HERSELF these days isn't really enough.And clinging to all the dignity she can gather,she would RATHER you NOT KNOW about it! BUT she's HUNGRY.

Will Rogers
Will Rogers4 years ago

It's not only African Americans or latinos, European American seniors are also feeling the pinch because of politicians mistakes and greed.

Teddie S.
Teddie S.4 years ago

I don't understand why they only pointed out the ethnic groups, a lot of us elderly people are also suffering.
They told us there would be no raise in our checks for the past two years because there was no cost of living increase. Where do they live? I would love to see these people try to survive on my disability check of $681. a month. It is definitely a struggle, and getting used to going to bed hungry at times.
You see these adds for starving people in other countries, but you need to start looking at your own people in your country and help them first. I'm not just talking about the elderly, I know that there are children and whole families going hungry now because of unemployment.
Shame on the United States.

Mady Marantz
Mady m.4 years ago

this society is falling apart- only the rich will survive

Marilyn L.
Marilyn L.4 years ago

No surprise here.

Grace Adams
Grace Adams4 years ago

There are some things that still need to be done--like retrofitting old buildings for energy efficiency, installing solar panels for sustainable energy production, babysitting children too young for school whose parents really need to juggle three half time jobs to try to cover the costs of housing and food.

Ernest R.
Ernest R.4 years ago

@ Linda T “When will we get it right?” We won’t. We now have no choice but to face the consequences of overpopulation that we have been refusing to recognize. @ Carol B---“Our poorest cannot be left out any longer” They have no problem leaving them out in third world countries. If you think that the US is not nearly a third world country now, get a check list. Strong middle class ? Wealth distribution ? Employment possibilities ? Responsive representative government ? Skewed income distribution ? Spending on military ? Use of torture ? Environmental responsibility ?