The lingering coronavirus is forcing older Black Americans to look much closer at their finances, including income stability, debt and retirement savings.
A recent report from AARP reveals that some 80% of Blacks are concerned about COVID-19 and its financial impact versus 47% of whites (See AARP infographic chart). The powerful nonprofit, which has more than 38 million members and focuses on issues affecting individuals over the age of 50, connected with BLACK ENTERPRISE on how to build and preserve Black wealth during these tumultuous times.
Much of the concern about the finances of the 50-plus demographic is being fueled by forces such as rising unemployment and uncertainty about how long the pandemic will devastate the economy. Those developments have made millions of Americans—including Blacks—increasingly worried about their prospects for retirement than in previous years.
Large numbers of individuals continue to witness the dramatic decline of the value of their retirement portfolios. Some are concerned about whether they will have to shelve retirement plans while others question if they will be able to retire at all. As such, the fallout has raised fresh fears from older individuals as they re-examine how to prepare for their golden years.
Yet, there are actions African Americans can take to help improve the status of their financial future.
Shani Hosten, vice president of Multicultural Leadership for African American/Black Strategy & Outreach at AARP, shared her perspective on how African Americans—especially those 50 or older—can maneuver myriad financial challenges in the current pandemic-driven climate.
She points out that COVID-19 has changed how people interact with the world and manage their finances daily. AARP research shows the current environment has resulted in greater debt and financial worries for Black Americans 50-plus compared to the general population. For example, she says, nearly a quarter of them have had trouble paying their bills during the pandemic and 43% are concerned they might have to use retirement savings to pay for necessary expenses.
“This community is staying home more to protect their health and that of others so their reliance on technology has significantly increased. Digital resources and tools have been and will continue to be essential for managing finances as the pandemic continues.”
So, how can individuals engage in financial planning? Hosten says AARP believes in providing the 50-plus community with sustainable resources, tips and tools that will have both short-term and long-term impacts. For example, in the short-term, she says, the organization is encouraging older adults to take inventory of monthly expenses and eliminate unnecessary items at this time.
For those who have recently lost a job, she suggests enhancing their LinkedIn profiles and learning new digital communication platforms, like Zoom, through online training available on sites like Coursera and YouTube. She maintains the adoption of such skills has always been important, but they are more vital than ever given the pandemic.
For long-term planning, many older adults are concerned that the pandemic will force them into early retirement—if it has not already—but the question is whether they can afford to. She says many resources can support retirement planning and help you boost retirement savings, including AARP’s Ace Your Retirement experience. “I believe these tools address the unique financial challenges presented by COVID-19 and that those same tools will also provide lasting benefits beyond the pandemic,” Hosten says.
And with the prolonged nature of COVID-19 and its ongoing impact on the economy and employment, Hosten talked about resources AARP has provided or will introduce for its members to improve money management practices and get them ready for other potential challenges, including healthcare.
Hosten says AARP has been committed to helping individuals achieve financial resilience for years. She noted a great resource offered by AARP Foundation to help achieve this in such trying times is its Fintech for Financial Resilience program, which was created in collaboration with JPMorgan Chase. “Digital and fintech tools can help us accomplish everyday money management tasks without extra stress.” She added the Fintech site has a host of instructional and interactive resources for anyone to explore.
She says additional resources that AARP also offers are always available including its Black Community page, which provides resources and tools across all areas that impact the African American 50-plus community. Another is the AARP Money Map, which helps anyone 18-plus create a plan of action for managing debt and keeping their finances on track.
“We also continually update our website, aarp.org/coronavirus, daily since March with critical news and information Americans 50-plus and their families need to know regarding their health, well-being, and finances during this time,” Hosten says.