Retirement Risk Across Demographics Team 4: Alayne Becker, Nicholas Chernick, Yu Fan, Samuel Houseworth, Spike Knickel, Justin Newlen, Beth Sanger, Yifan Yang

Demographics Race Gender Socio-economic Status

Investing Strategies All strategies involve a mix of high-risk and low-risk investments Whites & Asian-Americans prefer high-risk, high-reward investments like stocks African-Americans prefer low-risk investments like gov’t bonds Lack of trust in stock market Hispanics prefer bonds & tangible investments like real estate Historically, whites & Asian-Americans earn a larger balance AA’s & Hispanics lag behind because of low return of low-risk investments These groups tend to come from family that are inexperienced in investing

Health & Working Conditions Asian-Americans tend to live longer & work in less physically demanding jobs. Asian-Americans tend to work longer to offset the need for more retirement money Hispanics tend to work more physically demanding jobs Even in similar jobs, Hispanics are likely to suffer more injuries than white counterparts, less likely to file claims African-Americans are more likely to take money out of their retirement savings to cover healthcare costs Fewer AA’s have healthcare coverage than other races

Cultural Background Hispanics are very family-orientated, have higher marriage rates, lower divorce rate Older Hispanic males keep work longer hours, provide more steady income African-American have very low marriage rate, but very high divorce rate Retirement savings habits are very positively correlated with marriage rates Because of financial experience, whites start saving for retirement earlier Whites, in similar salary ranges, have, on average, 50% more money saved than AA’s at any given time

Gender Salary Women earn less and work less. Age Women live longer and have longer retirement period. Inflation Women live longer, money worth less. Marriage Men choose less risk, women choose more risk. Children More women than men have children. Choose less risk. Healthcare Women have more health problems.

Lower Class Retirement Risk Not having insurance coverage for worst case scenarios Higher risk of disability Medicare only covers a fraction of medical bills Fewer retirement plan options due to occupation and income Higher chance of pulling money out of retirement savings for unexpected expenses

Middle Class Retirement Risk Risk of outliving Savings Traditional pension plans are disappearing in place of 401(k)’s Not enough money to take on the market risk Not educated enough to make wise investment decisions Uncertainty with Social Security

Upper Class Retirement Risk Longevity Risk Less likely to die from preventable causes Greater chance of living longer than expected and depleting their savings Stock Market Risk Have more ability to invest in the stock market creating a greater list of losing that money due to a downturn or crash

Bibliography Lewis, Jeffrey R., and Cindy Hounsell, eds. "What Women Need to Know About Retirement." Heinz Family Philanthropies and The Women's Institute for a Secure Retirement. Web.. "Women and the Retirement Savings Gap - SmartMoney.com." Online Investing: Stocks, Personal Finance & Mutual Funds at SmartMoney.com. Web..