A new report published by UnidosUS and the National Institute on Retirement Security, “Latinos’ Retirement Insecurity in the United States,” examines the disparities in retirement readiness found between working Latinos aged 21 to 64 and other racial and ethnic groups in the U.S.

Authors of the paper include Jennifer Brown, a senior economic policy adviser at UnidosUS (formerly the National Council for La Raza), and Diane Oakley, executive director of the National Institute on Retirement Security leading the organization’s research, education and strategic planning initiatives.

For context, the report cites U.S. Census Bureau statistics estimating that by 2060, the Latino population will number 119 million and will account for approximately 28.6% of the U.S. population. Additionally, according to figures from the U.S. Administration on Aging, the Latino population that is age 65 and older will number 21.5 million and will comprise 21.5% of the population by 2060.

According to Brown and Oakley, access and eligibility to an employer-sponsored retirement plan remains the largest hurdle to Latinos’ retirement security. The authors find the retirement plan participation rate for Latino workers (30.9%) is about 22 percentage points lower than participation rate of white workers (53%). Brown and Oakley attribute this to the fact that Latinos face higher access and eligibility hurdles relative to other groups.

According to Brown and Oakley, when Latino workers have access and are eligible to participate in a plan, they show slightly higher take-up rates when compared with others races and ethnicities. At the same time, for working Latino individuals who are saving, their average savings in a retirement account is less than one-third of the average retirement savings of white workers. Overall, less than one percent of Latino workers have retirement accounts equal to or greater than their annual income.

Older and younger generations both face challenges

According to the report, Latinos and Latinas of all ages face challenges in saving for retirement.

“Older Latinas especially experience difficulties in making ends meet without income from wages,” the report says. “Without income from work, many Latinas age 65 and older would not be able to afford basic expenses. Older Latinas also face poverty rates three times higher than older white women, and one in five Latinas over the age of 65 live in poverty.”

Millennial Latinos and Latinas also face significant challenges in saving for retirement, the report says, given that 83% of working Millennial Latinos had nothing saved for retirement as of 2014. Among those with access, only 19.1% of Millennial Latino men and 22.5% of Latinas participated in an employer-sponsored retirement savings account.

According to Brown and Oakley, in addition to having the lowest level of access to employer-sponsored retirement plans, Latinos also have the lowest rate of eligibility for the retirement plans offered by their employers.

“This could be due to the fact that many Latinos have not worked for their employer for one year, work part-time, or are under the age of 21—making them ineligible to participate in a retirement plan,” the paper says. “Among Latinos with access to a retirement plan, only 60.3% also meet the eligibility requirements set by employers, compared to higher retirement plan eligibility rates for all workers (72.9%), whites (76.1%) and all non-white workers (65%).”

Solutions from employers and policymakers

The report indicates several policy options that would greatly benefit Latinos.

First would be to expand plan eligibility for part-time workers, given that top reason that Latinos did not have retirement savings was that they worked part-time.

“Allowing part-time workers the ability to participate in employer-sponsored retirement plans would greatly increase the number of Latinos that could save in a retirement plan,” Brown and Oakley argue.

Another solution, easier to effectuate but likely less effective, will be for employers to promote the Saver’s Credit. As the paper explains, the Saver’s Credit is a non-refundable income tax credit for taxpayers with adjusted gross incomes of less than $31,500 for single filers and $63,000 for joint filers.

“Given that the median household income for Latinos was $46,882 in 2016, a large number of Latino households would qualify for the Federal Saver’s credit if they saved for retirement,” the report says. “By further promoting the credit, many more Latino households could be rewarded for saving for retirement.”

Finally, Brown and Oakley urge the further development of state-based retirement savings plans for private sector workers who otherwise lack access to tax-qualified savings opportunities at work.

“In 2014, an estimated 103 million Americans between 21 and 64 did not have access to an employer-sponsored retirement account,” the report says. “In response to this gap, a number of states have enacted state-sponsored retirement savings programs that automatically enroll individuals into a plan if they are not covered by an employer-sponsored plan. For Latinos, these plans are especially important.”

According to the report, state-backed retirement savings plans can assist with providing low-cost retirement products to working Latinos who are not covered by a workplace retirement plan, helping to alleviate the current retirement savings crisis that Latinos face.