California Dreaming or California Struggling? · more likely to struggle financially compared to...

AARP RESEARCH | AARP.ORG/CADREAMINGORSTRUGGLING | © 2017 AARP. ALL RIGHTS RESERVED

California Dreaming orCalifornia Struggling?

2017 S tatew ideL atinos/asFindingsfrom the AARP study of California AdultsAges 36-70 in the Workforce#CADreamingOrStruggling

https://doi.org/10.26419/res.00163.010


GenX :Born1965-1980 (n=208)Baby Boom er:Born1946-1964 (n=206)

Fielddates: June22-O ctober6,2016

+ Interview sinEnglish,S panish,Korean,andVietnam ese

L andline/cellphoneR DD study of414 CaliforniaL atinos/asages36-70 inthew orkforce(from 2,485respondents)

SURVEY METHODOLOGY

Full methodology and pending multicultural findings will be available at www.aarp.org/CADreamingorStruggling


• Forsom eL atinos/asinCalifornia,saving,particularlysavingforretirem ent,isaluxury

they sim ply cannotafford.N earlytw oinfive(39% )say they w ouldnotbeabletopay an

em ergencyexpenseof$1,000 orm ore,andasim ilarpercent(38% )feelthey areeitherjust

gettingby orfindingitdifficulttogetby financially.

3

• W ithinCalifornia,broadbasedsupportexistsforlegislationbothtoaddressaccessto

affordablehousing(70% )andw orkplaceretirem entsavingsplans(71% ).T heseinitiatives

receivestrongm ajority supportacrosskey regional,ethnic,andgenerationalsegm ents.

• Fornon-hom eow ners,affordablehousingintheirpreferredcom m unity(49% )andthe

financialexpensesassociatedw ithbecom ingahom eow ner(47% )aretophousing

concerns.Forhom eow ners,affordingthecostsassociatedw ithm aintaininghom e

ow nershipsuchaspayingpropertytaxes(17% )areatopconcern.

• T w oinfive(42% )say they haveconsideredleavingthestateofCaliforniaandliving

som ew hereelseduetothehighcostofliving.

• Em ploym entuncertainty,healthcare,andhousingexpensesarew orriesandobstaclesthat

im pactretirem entsavingsforL atinos/asinCalifornia,andoverhalf(54% )areanxious

abouthavingenoughm oney savedinordertolivecom fortablyinretirem ent.

EXECUTIVE SUMMARY


What You Need To KnowSome California Latinos/as are living the dream,

but many are struggling

• Many say they are at best getting by, they are having difficulty saving for their financialfuture, and they could not withstand a financial shock. California Latino/a Gen Xers aremore likely to struggle financially compared to Baby Boomers.

• Housing costs are a concern for homeowners and non-homeowners, and two in fivehave considered leaving California because of the high cost of living.

• Across generations, about half are anxious about having enough money saved forretirement. At least seven in ten Gen Xers and Boomers believe elected officialsshould support affordable housing and workplace retirement savings plans to helpCalifornians.

4


KEY FINDINGS


About two in five California Latino/a residents age 36-70 in the workforce (38%) say they are

currently just getting by or finding it difficult to get by financially.

6

32

30

38

19

19

Living comfortably

Doing ok

Just getting by/finding it difficult to get by (net)

Finding it difficult to get by

Just getting by

S T AT EW IDEL AT IN O S /A S :How M anagingFinancially (% )

Q21: On the whole, which of the following best describes how well you are managing financially these days?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)QS8. [ALL] Do you do something to earn extra money that is not your main source of income?

GenX(age36-50)

Boom er(age51-70)

Finding itdifficult to get

by22 12

Just getting by 21 15

Justgettingby/findingit

difficulttogetby

43 27

Doing ok 28 35

Livingcomfortably

29 37

14%have a sidejob to makeextra money

14%have a sidejob to makeextra money


Many California Latinos/as are not prepared for a financial shock. Over one in three (39%)

could not afford an emergency expense of $1,000 or less, and over half (57%) could notwithstand an emergency expense of $5,000 or less.

7

4

37

18

9

15

15

Not sure

$5,000+

$1,000-$4,999

$500-$999

$100-$499

Under $100

S T AT EW IDEL AT IN O S /A S :L argestEm ergency ExpenseCouldP ay (% )

Q10/10b: Based on your current financial situation, what is the largest emergency expense that you could pay right now using cash, or money in yourchecking or savings account?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)

57%

39%

GenX(age36-50)

Boom er(age51-70)

Under $100 17 12

$100-$499 15 14

$500-$999 7 14

$1,000-$4,999

18 19

$5,000+ 36 38

Not sure 5 1

39% 40%


Not saving enough and not planning for retirement are the financial concerns that California

Latinos/as most often worry about.

8

S T AT EW IDEL AT IN O S /A S :O ftenW orry A bout… (% )

Q2: How often do you worry about…?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)*Base: Hispanic Employed (n=362), Gen X (n=183), Boomer (n=179)**Base: Hispanic Looking for work (n=52), Gen X (n=TS), Boomer (n=TS)TS=Base size too small

2

15

18

22

24

24

32

40

Having the chance to work

Losing your job

Having/taking on too much debt

Not being able to pay bills

Having unexpected emergency won't be able to pay for

Not being able to afford costs related to health care

Not planning enough for retirement

Not saving enough

GenX(age36-50)

Boom er(age51-70)

-------- 40 40

-------- 37 23

-------- 24 24

-------- 28 15

-------- 25 15

-------- 19 17

-------- * *

-------- ** **


Among the obstacles California Latinos/as face when saving for retirement, having money

left after paying bills, the fear of losing their job/taking a big pay cut, and housing expensestop the list. Moving/purchasing a new home is one of the top concerns for Gen Xers.

9

38

40

40

41

42

43

44

45

51

54

55

Caring for an elderly parent or relative

Having a lot of debt to payoff

A major health need for yourself or family member

Paying for your transportation expenses

Moving, purchasing a new home or a change in housing

Paying for everyday health care expenses

Paying for your children's education

Paying for your health insurance

Paying for your housing expenses

Losing a job or taking a big pay cut

Not having enough money left over after paying bills

S T AT EW IDEL AT IN O S /A S :M ajorO bstacletoS avingforR etirem ent(% )

Q14: Have any of the following been a major obstacle for you personally when it comes to saving for your retirement years?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)

GenX(age36-50)

Boom er(age51-70)

-------- 53 59

-------- 55 51

-------- 56 42

-------- 45 43

-------- 47 40

-------- 46 37

-------- 51 25

-------- 44 35

-------- 42 36

-------- 39 43

-------- 40 35


Extremely confident, 9

Very confident , 21

Somewhat confident,33

Not at all confident, 21

Not too confident, 15

Many respondents, particularly Gen Xers, feel that retirement is a luxury they simply cannot

afford. One in three California Latinos/as (36%) are not too or not at all confident they willbe able to retire and not have to work for money. Gen Xers are significantly less confident

in being able to retire than Boomers.

10

36%

S T AT EW IDEL AT IN O S /A S :How ConfidentW illBeA bletoR etireandN otW orkforM oney (% )

Q6: Overall, how confident are you that you will be able to retire at some point and no longer work for money?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)

GenX(age36-50)

Boom er(age51-70)

Not at all/ Nottoo confident

41 26

Somewhatconfident

31 38

Very confident 19 25

Extremelyconfident

8 11Don’t know/Refuse percentages not shown


As a result, over half (54%) are anxious about having enough money to live comfortably in

retirement.

11

Not anxious at all,21

Not very anxious,25

Somewhatanxious, 38

Very anxious, 16

54%

S T AT EW IDEL AT IN O S /A S :A nxiety L evelA boutHavingM oney toL iveCom fortably inR etirem ent(% )

Q3: As you think about your finances in the future, how anxious do you feel about having enough money to live comfortably through your retirement years?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)

GenX(age36-50)

Boom er(age51-70)

Very/ Somewhatanxious

58 46

Not very anxious 24 26

Not anxious at all 18 28


Agree, 78

Neutral, 3

Disagree,17Support,

71

Neutral, 5

Oppose,19

Given the concerns and anxiety about retirement preparation, it is not surprising that a

majority of California Latinos/as support, and agree elected officials should also support,legislation for a privately managed retirement plan for California. Gen Xers are especially

supportive.

12

S upport/O pposeL egislationforP rivatelyM anagedR etirem entS avingsP lan(% )

A gree/DisagreeElectedO fficialsS houldS upportS avingsP lan(% )

Q11: Many Californians, especially those who work for small businesses, do not have a way to save for retirement at work. One way to help moreCalifornians save would be for the state to establish a privately-managed retirement savings program, similar to a 401k plan, where workers cancontribute to a private retirement account that is professionally managed. Workers can choose whether or not to participate, and the account would beportable from job to job. The plan would be a public-private partnership and would have low fees for participants. Would you say you support or opposethis proposal?Q13: Do you agree or disagree with the following statement: California elected officials should support creating a retirement savings plan so more workersin the state of California can save for retirement automatically out of their paycheck.Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)

GenX(age36-50)

Boom er(age51-70)

73 65

GenX(age36-50)

Boom er(age51-70)

80 75

Don’t know/Refuse percentages not shown Don’t know/Refuse percentages not shown


Among Latino/a respondents, non-homeowner and homeowner rates* are evenly split, but

housing situation varies by age. Gen Xers are more likely to be single renters (36%), whileBoomers are more likely to live with family (23%).

13

<.5

3

15

29

47

53

Something else

Live with friends

Live with family

Rent

Non-homeowner (net)

Own

S T AT EW IDEL AT IN O S /A S :HousingS ituation(% )

Q17: Switching gears now, do you currently own your own home, rent, live with family, or live with friends?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)* 2016 Statewide homeownership rate in California for all residents :54.6%. US Census Bureau. https://www.census.gov/housing/hvs/data/rates.html

GenX(age36-50)

Boom er(age51-70)

Own 51 57

N on-hom eow ner

(net)49 43

Rent 36 16

Live with family 12 23

Live with friends 2 4

Something else -- --

AARP RESEARCH | AARP.ORG/CADREAMINGORSTRUGGLING | © 2017 AARP. ALL RIGHTS RESERVED 14

When asked about housing concerns, affordable housing tops the list for all respondents, and is

significantly pronounced with non-homeowners and Gen Xers. Boomers-many who live with family, are

concerned about affording monthly housing costs.

S T AT EW IDEL AT IN O S /A S :Extrem ely/Very ConcernedA boutinCom ingYears(% )

T O T A LN on-

Hom eow nerHom eow ner

GenX Boom er

(age36-50) (age51-70)

Ability to find affordable housing in preferredneighborhood 31 49 18 36 20

Ability to pay monthly rent or mortgage payments 31 31 7 33 28

Ability to live close to work 27 36 6 19 **

Ability to pay utility bills 26 41 11 32 17

Ability to afford a down payment to buy a home 15 28 0 28 21

Ability to qualify for a mortgage to buy a home 15 47 0 18 **

Ability to pay property taxes 10 0 17 ** **

Q18: How concerned are you about your (INSERT ITEM)?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206) *Base: Hispanic and don’t own a home (n=203), Gen X(n=110), Boomer (n=93) **Base: Hispanic and own home (n=210), Gen X (n=97), Boomer (n=113)


Many California Latinos/as are feeling the squeeze of the high cost of living in California,

as two in five (42%) have considered leaving the state entirely and living somewhere else.

15

Yes, 42

No, 58

S T AT EW IDEL AT IN O S /A S :HaveConsideredL eavingCaliforniaBecauseofHighCostofL iving(% )

Q19: Have you ever considered leaving California and living somewhere else because of the high cost of living?Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)*http://money.cnn.com/2016/11/04/pf/people-moving-out-california/

GenX(age36-50)

Boom er(age51-70)

43 40

Interestingly, a recent CNN Money piece found that “For every home buyer coming into the state, thereare three Californians selling and moving elsewhere” because “they can’t afford to live there anymore.”*


Given the concerns about affordable housing and the high cost of living in the state, it

comes as no surprise that most Latino/a respondents across the state of California agreetheir elected officials should support legislation that increases access to affordable

housing (70%).

16

S T AT EW IDEL AT IN O S /A S :ElectedO fficialsS houldS upportL egislationIncreasingA ccesstoA ffordableHousingforCalifornians(% )

Q20: Do you agree or disagree with the following statement: California elected officials should support legislation increasing access to affordable housingfor more Californians.Base: Hispanic CA Residents age 36-70 in the workforce (n=414), Gen X (n=208), Boomer (n=206)

GenX(age36-50)

Boom er(age51-70)

69 71Agree, 70

Neutral, 4

Disagree,26


Moving Forward

17

Recent progress in California helps to address the ability of residentsto save for their future and get by in our high cost of livingenvironment, but many are still struggling.

• Secure Choice

• Housing Affordability

• Minimum Wage Increase

• Paid Family Leave

AARP looks forward to working with you to continue moving forward.

AARP RESEARCH | AARP.ORG/CADREAMINGORSTRUGGLING | © 2017 AARP. ALL RIGHTS RESERVED 18

Education

Less than high school- did notreceive a diploma or GED 31%High school graduateor equivalent 24%Post high school certification,trade school, or diploma 3%

Some college 19%4 year degree(Bachelor's Degree) 15%

Post graduate study or degree 7%

Refused <.5%

Em ploym entS tatus

Self-employed full-time 13%

Self-employed part-time 1%

Employed full-time 65%

Employed part-time 11%

Unemployed and looking for work 10%

Incom e

< $10,000 5%$10,000 - $19,999 7%

$20,000 - $29,999 9%$30,000 - $49,999 17%

$50,000 - $74,999 10%$75,000 - $99,999 16%

$100,000 - $149,999 16%$150,000+ 12%

Refused 6%R egisteredVoter

Yes 65%No 33%

P oliticalP arty

Democrat 45%Republican 14%Independent 16%Something else/ None 12%Not Sure 7%Refused 2%

Respondent Profile: Socioeconomic & Voting(n=414 California Latino/a Adults age 36-70 in the workforce)


Respondent Profile: Demographics(n=414 California Latino/a Adults age 36-70 in the workforce)

19

A ge

Gen X(age36-50) 67%Boomer(age 51-70) 33%

Gender

Male 57%

Female 43%

M aritalS tatus

Single, never married 12%

Married 64%Not married, living with yourpartner or significant other 13%

Separated or Divorced 10%

Widowed 2%

R ace/Ethnicity

White or Caucasian 46%Native Americanor Alaskan Native 3%Black 5%Asian <.5%Native Hawaiianor Pacific Islander 2%

Latino/a 100%Other 42%


More About This Report

20

Additional Multicultural and Geographicalfindings will soon be available at:www.aarp.org/CADreamingOrStruggling

Engage with us on social media with:#CADreamingOrStruggling

For more information contact:Stacey Moore, AARP California [email protected] (562) 627-5792 orBrittne Nelson, PhD AARP Research [email protected] (202) 434-6307

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