The Race Savings Gap

Among families with an employment-based plan, the percentage with only a traditional pension plan decreased from 40 percent in 1992 to 24 percent in 2004, according to the Employee Benefit Research Institute.

"All across America, corporate pension funds are being frozen and many government pension systems are underfunded," pointed out Mellody Hobson, president of Ariel, a black-owned institutional money management firm and mutual fund company based in Chicago. "It's a national crisis that will hit blacks especially hard because we've all bought into the promise."

The investor survey also found that three times as many African Americans as whites (29 percent vs. 10 percent) say they plan to start a business after they retire.

"People think a business is their brass ring so they don't need to save," Hobson said.

In addition, a higher percentage of African Americans than whites own real estate other than their home (42 percent vs. 33 percent), and of these, a greater share of African Americans (58 percent vs. 48 percent) say they expect these investments to help fund retirement.

Also notable in the survey was a finding that a higher percentage of blacks are taking care of adult children or aging parents.

According to the survey, 27 percent of African Americans, compared with 18 percent of whites, have an adult other than a spouse living in their home. African Americans who are concerned about saving for their children's education or those who are worried about caring for elderly parents are considerably less likely to be saving even $100 per month for retirement, the survey found.

It's understandable that you feel obligated to take care of Peaches or your Big Mama so you put off saving for your retirement. However, you've still got to save. Otherwise, the cycle continues -- meaning that when you retire, your relatives will have to take care of you, and then they can't save for their retirement. That circle of life has got to be straightened out.

"Caring for an elderly parent and aspiring to send a kid to college are all good things," Toppin said. "The challenge for our community is that many blacks have made it into the middle class but will very likely be retiring into the lower class, if we can retire at all."

The usefulness of this Ariel-Schwab investor survey is to again point out that we all need to have a diversified retirement portfolio. Because in the end, you'll want to have many options in case one of your pots boils down and becomes bone dry. If you've got only one pot, you can get burned.

· On the air: Michelle Singletary discusses personal finance Tuesdays on NPR's "Day to Day" program and online athttp://www.npr.org.

· By mail: Readers can write to her at The Washington Post, 1150 15th St. NW, Washington, D.C. 20071.

· By e-mail:singletarym@washpost.com.

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