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Here’s why young adults in Puerto Rico are struggling financially

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Parade attendees wave Puerto Rican flags on Fifth Avenue in Manhattan during the annual Puerto Rico Day Parade. 

Luiz C. Ribeiro | New York Daily News | Tribune News Service | Getty Images

Young adults in Puerto Rico are on shaky financial ground, a study finds.

About 47% of respondents in the U.S. territory are financially fragile, meaning they lack confidence in their ability to absorb a $2,000 economic shock, according to a September report from the Financial Industry Regulatory Authority Investor Education Foundation.

“This is the first time a study of this nature has been done on Puerto Rico,” said report co-author Harold Toro. He is also the research director and chair in economic development research at the Center for a New Economy, an economy-focused think tank based on the island.

“It highlights things that people feel and experience, but that are hard to find numbers for,” Toro said.

More than half, or 59%, of adults ages 18 to 29 on the island are financially fragile, compared to 47% of those ages 30 to 54 and 41% of those age 55 or older, FINRA found. The organization in 2021 polled 1,001 adults who live in Puerto Rico.

“The financial fragility and capability more broadly in Puerto Rico … it’s pretty dire when we compare it to the mainland United States,” said report co-author Olivia Valdés, senior researcher at the FINRA Investor Education Foundation.

Financial fragility, particularly for young adults, is much higher in Puerto Rico than on the mainland U.S. More than half, or 59%, of 18 to 29-year-olds are financially struggling in Puerto Rico compared to 38% of the same age group in the U.S., according to FINRA data.

About 30% of U.S. residents overall were considered financially fragile in 2021, according to FINRA’s latest Financial Capability in the United States report, which polled 27,118 U.S. adults in 2021. The Puerto Rico survey was separate, but fielded at the same time.

The younger generation has experienced financial strain for over two decades.

Vicente Feliciano

founder and president of Advantage Business Consulting, a market analysis and business consulting firm in San Juan, Puerto Rico

Many young adults leave Puerto Rico to try and improve their financial situation, by seeking education or employment in the United States or in other countries. For the young adults who stay, the generation must contend with an economy under recovery, an electric grid hanging on by a thread and sky-high costs for basic needs like housing.

Understanding why young Puerto Ricans are financially fragile could help with efforts to retain younger residents and bring working professionals back to the island, experts say.

But “living in Puerto Rico can’t just be a matter of survival, it also has to be a place where you can thrive,” said Fernando Tormos Aponte, an assistant professor of sociology at the University of Pittsburgh.

Young Puerto Ricans are ‘having a tougher time’

To be sure, a certain degree of financial strain is typical for people just starting out. Generally speaking, financial standing gets better with age.

But financial fragility is more prominent among young adults in Puerto Rico compared to the U.S.

“People who are younger seem to be … having a tougher time,” Toro said.

Adults age 18 to 29 in Puerto Rico are less likely than adults ages 30 and over to report having emergency and retirement savings, FINRA found.

Less than a quarter, 22%, of 18- to 34-year-olds in Puerto Rico have any type of retirement account. Among that age group on the mainland U.S., 43% do, according to the broader FINRA analysis.

Young adults in Puerto Rico are also more likely than older residents to have student loan and medical debt.

Younger generations only know a Puerto Rico in crisis

Puerto Rico’s economy “is doing quite well,” said Vicente Feliciano, founder and president of Advantage Business Consulting, a market analysis and business consulting firm in San Juan, Puerto Rico.

The job market has improved, and salaries are growing at a faster pace than inflation, thanks to the increase in minimum wage, Feliciano said. While the federal minimum wage in the U.S. is $7.25, it’s $10.50 in Puerto Rico.

Employment in the private sector was at a 15-year high since mid- 2022, according to the Federal Reserve Bank of New York.

Still, the median household income on the island was just $25,621 in 2023, less than a third of the $80,610 median household income in the mainland U.S., per Census data.

Even though the last couple of years have been better, for adults under 40 in Puerto Rico, “most of their working lives have been overshadowed by the depression that Puerto Rico fell through from 2006 through 2015,” Feliciano said.

“The younger generation has experienced financial strain for over two decades,” he said. “They have seen many of their friends leave the country. They are frustrated. They blame the traditional [political] parties for something that may or may not be their fault, but is very real.”

‘We want people to come back’

Alejandro Talavera Correa moved to Washington, D.C. in 2019 for a job in finance. The role and pay were too good to pass up, he said: “People have to leave in order to get a competitive salary.”

But within a few years, he found himself moving back to Puerto Rico.

Talavera Correa, now 28, found an opportunity to return to Puerto Rico through El Comeback, an online job board that is tailored to include job postings that meet market salary standards or offer benefit packages for prospective applicants.

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“We want people to come back,” said Ana Laura Miranda, project manager of El Comeback. “We need to be realistic. We need to invest in employees and if we don’t have the salaries, then we need to create benefit packages.”

According to Miranda, the audience that mostly uses the platform are in their late 20s to those in their mid to late 30s. They vary from single adults to families with kids.

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The initiative is still in its early stages, and has attracted and retained 51 candidates, Miranda said.

Candidates are often looking to be close to family or regain the sense of belonging or warmth that comes with being in Puerto Rico, said Miranda. But young workers returning to Puerto Rico may face new financial challenges.

“There’s always going to be a certain pay cut,” as six figure salaries are not as common on the island as they are in the U.S. And “Puerto Rico is not cheap,” said Miranda. “The cost of living … it’s real. We cannot miss that.”

The island — like the mainland U.S. — has a housing market that’s unaffordable for many residents, and having a car is essential to get around because public transportation services can be unreliable.

Talavera Correa was fortunate to buy a condo during the pandemic when mortgage rates were low.

“If you don’t have that kind of money, you’re essentially stuck either renting or living with your parents,” said Talavera Correa.

Yet, like most Puerto Ricans on the island, he still struggles with regular blackouts and electricity problems. Those send him to his mom’s house, where service is more reliable due to her solar panels.

“Blackouts and problems with electricity are quite recurrent,” said Advantage Business Consulting’s Feliciano. “Electricity is a major distinction between the U.S. and Puerto Rico and it hits the younger generation harder than it hits the wealthier, older generation.” 

Despite the challenges, Talavera Correa is happy with his decision.

“It’s essentially the quality of life that you can have here in Puerto Rico. You have the beaches, everything outdoors, and the opportunity that you can have to have a happy life,” he said.

“But if that comes with economic restraints, or just overall living situations regarding the electricity, water … that disappoints a lot of people [who] come back.”

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Disability advocates sue Social Security and DOGE to stop service cuts

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A Social Security Administration (SSA) office in Washington, DC, March 26, 2025. 

Saul Loeb | Afp | Getty Images

A group of disability advocates filed a federal lawsuit against the Social Security Administration and the so-called Department of Government Efficiency on Wednesday aimed at stopping cuts to the agency’s services.

Recent changes at the Social Security Administration under DOGE — including staff reductions, the elimination of certain offices and new requirements to seek in-person services — have made it more difficult for individuals with disabilities and older adults to access benefits, the lawsuit argues.

The complaint was filed in the U.S. District Court for the District of Columbia.

The plaintiffs include the National Federation of the Blind, the American Association of People with Disabilities, Deaf Equality, the National Committee to Preserve Social Security and Medicare, the Massachusetts Senior Action Council and individual beneficiaries.

“The defendants’ actions are an unprecedented and unconstitutional assault on Social Security benefits, concealed beneath the hollow pretense of bureaucratic ‘reform,'” the complaint states.

In nine weeks, the new administration has “upended” the agency with “sweeping and destabilizing policy changes,” the plaintiffs claim, that have shifted agency functions to local offices while slashing telephone services.

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“The result is a systematic dismantling of SSA’s core functions, leaving millions of beneficiaries without the essential benefits they are legally entitled to,” the lawsuit complaint states.

The “mass restructuring” of the agency is unlawful and violates the Rehabilitation Act and the Administrative Procedure Act, the lawsuit argues. The changes also violate multiple constitutional provisions, including the First Amendment right to petition the government for redress of grievances, according to the plaintiffs.

With 1.1 million disability claims pending, the recent actions could also be life threatening to individuals who are dying or going bankrupt while waiting for decisions, they allege.

The Social Security Administration did not respond to CNBC’s request for comment.

“President Trump has made it clear he is committed to making the federal government more efficient,” White House spokesperson Liz Huston said in an email statement. “He has the authority to manage agency restructuring and workforce reductions, and the administration’s actions are fully compliant with the law.”

Lawsuit alleges reform is ‘administrative vandalism’

People hold signs during a protest against cuts made by U.S. President Donald Trump’s administration to the Social Security Administration, in White Plains, New York, U.S., March 22, 2025. 

Nathan Layne | Reuters

The Social Security Administration sends monthly checks to around 73 million Social Security and Supplemental Security Income beneficiaries.

DOGE, which is not an official government entity, has been tasked with cutting “waste, fraud and abuse” within the federal government. President Donald Trump issued an executive order creating DOGE on Jan. 20, the same day he was inaugurated.

Since then, the Social Security Administration has cut 7,000 employee positions and closed the Office of Civil Rights and Equal Opportunity and the Office of Transformation. The Office of Civil Rights and Equal Opportunity handled the agency’s equal employment opportunity and civil rights programs. The Office of Transformation was responsible for coordinating customer service-related initiatives like adding the ability to use digital signatures and electronic documents.

The Social Security Administration has also changed its identity proofing policies for claiming benefits and changing direct deposit information that is expected to require more individuals to visit the agency’s offices in person.

The agency has updated its policy, allowing individuals applying for Social Security Disability Insurance, Medicare, or Supplemental Security Income who cannot use a personal my Social Security account to complete their claim entirely over the telephone, starting April 14. 

The reforms amount to the dismantling of “core functions of SSA, abandoning millions of Americans to poverty and indignity,” according to the plaintiffs’ complaint.

“What the defendants frame as ‘reform’ is, in truth, administrative vandalism,” the lawsuit states.

Beneficiaries face long waits, overpayment issues

The plaintiffs include seven individuals whose experiences, including long customer service waits and, in some cases, demands to repay large sums to the Social Security Administration, are detailed in the complaint.

One plaintiff, Treva Olivero, who has been legally blind since birth, was informed in March 2024 that she had been overpaid Social Security disability insurance benefits for five or six years, prompting the agency to demand she repay more than $100,000, according to the complaint.

Olivero’s Medicaid coverage was also terminated soon after, which left her without income and health coverage. She has since been in an “ongoing struggle” to have her disability benefits reinstated, while also facing almost $80,000 in medical debt, according to the complaint.

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Another plaintiff, Merry Schoch, who received Social Security disability insurance for many years, returned to work to help pay for large medical bills after she was hit by a waste management truck in 2022. She reported her income to the Social Security Administration, and the agency made no changes to her benefit payments, according to the complaint.

Two years later, Schoch stopped working and reported her unemployment to the Social Security Administration. In August 2024, the agency then terminated her benefits and informed Schoch that she owed $30,000 for the disability benefit payments she received while working full time, according to the complaint.

Last September, Schoch was informed she could reapply for benefits. However, she has since struggled to get in touch with the agency over the phone, online and in person. 

Both Olivero and Schoch are members of the National Federation of the Blind, which is also a plaintiff.

The plaintiffs want the court to reverse the Social Security Administration’s recent reforms, including staff reductions, closures of certain offices and policies requiring in-person appointments.

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Amid trade turmoil, ‘you do not want to time the market’

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Pres. Trump unveils sweeping tariffs: Here's what to know

As President Donald Trump rolls out sweeping new tariffs on goods imported into the United States, Americans are growing increasingly pessimistic about their financial fate.

Consumers worry that the duties will cause inflation to flare up again, while investors fear that higher prices will mean lower profits and more pain for the battered stock market

As of Thursday morning, futures tied to the Dow Jones Industrial Average were down 1,200 points, or 2.8%. S&P 500 futures sank 3.4%, and Nasdaq-100 futures lost 4%.

But sharp drops — or sudden spikes — in the market are to be expected, according to Jean Chatzky, CEO of HerMoney.com and host of the podcast HerMoney with Jean Chatzky.

“With these volatile markets, you do not want to time the market,” she said of the old adage. “Timing the market doesn’t work — it’s time in the market.”

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Trade tensions, inflation and concerns about a possible recession have undermined consumer confidence across the board, several studies show.

Still, it’s normal for most Americans to feel unnerved during heightened volatility, Chatzky said.

“There’s very little doubt that consumers are feeling nervous, maybe more nervous than we’ve felt in quite some time,” she said.

Committing to setting money aside in a high-yield savings account, whether by scaling back on dining out or rideshare expenses, will help regain some financial control, Chatzky said.

Top-yielding online savings accounts currently pay 4.4%, on average, well beyond the savings account rates at some of the largest retail banks, which average just 0.41%.

“Taking action is the best way to feel more resilient,” she said.

It’s understandable why some may be hesitant to continue investing, however, when you are investing for the long term, a down market is an opportunity for dollar-cost averaging, which helps smooth out price fluctuations in the market, Chatzky said.

This is also a good time to check your investments to make sure you are still allocated properly and rebalance as needed, so you are not taking on more risk that you are comfortable with, she added.

Timing the market is a losing bet

Talk yourself down from making any sudden financial moves, Chatzky advised.

Trying to time the market is almost always a bad idea, other financial experts also say. That’s because it’s impossible to know when good and bad days will happen.

For example, the 10 best trading days by percentage gain for the S&P 500 over the past three decades all occurred during recessions, often in close proximity to the worst days, according to a Wells Fargo analysis published last year.

And, although stocks go up and down, the S&P 500 index has an average annualized return of around 10% over the past few decades.

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How to file for a free tax extension if you can’t make April 15 deadline

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Galina Zhigalova | Moment | Getty Images

If you can’t file your taxes by the April 15 deadline, there’s a free, easy way to submit a federal tax extension online, experts say.  

Nearly 1 in 3 American admit that they procrastinate when it comes filing their taxes, according to a January survey of more than 1,000 U.S. filers from IPX1031, an investment property exchange service. In addition, about 25% do not feel prepared to file their taxes, the survey found.

As of March 21, the IRS received roughly 80 million individual returns of the 140 million expected this filing season, the agency’s latest reporting shows.

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Many natural disaster victims have an automatic tax extension, which varies by jurisdiction. Military members serving in a combat zone also have more time to file. 

However, the federal tax deadline for the majority of taxpayers is April 15. It’s possible to push that due date to Oct. 15 by filing for an extension.

But “it’s an extension to file, not an extension to pay,” said Jo Anna Fellon, managing director at financial services firm CBIZ.

“It’s an extension to file, not an extension to pay.”

After the tax deadline, you will start incurring the failure-to-pay penalty of 0.5% of your unpaid taxes for each month or partial month that your taxes remain unpaid. The failure-to-pay penalty has a maximum charge of 25% of your unpaid taxes.

That’s cheaper than the failure-to-file penalty, which applies when you don’t submit your return by the deadline. The failure-to-file penalty is 5% of unpaid taxes monthly, also limited to 25%.

But you’ll also owe interest on your unpaid balance, which is currently 7% and accrues daily after April 15.

You can estimate your taxes owed by creating a “pro forma return” — or mock version of your filing — using as many tax forms as possible, Fellon said.

The ‘easiest way’ to file an extension

There are a few free options to file a tax extension.

For federal taxes, you can complete Form 4868 and mail it to the IRS. But it’s better to file digitally to avoid processing delays amid the agency’s shrinking workforce, experts say. Paper filing can also increase fraud risk, they say.

The “easiest way” is by choosing “extension” when making a payment for 2024, which automatically submits Form 4868, according to Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.

“It takes all of five minutes,” and you can double-check the transaction via your IRS online account, he said.

IRS Direct Pay

Internal Revenue Service

Alternatively, you can file your extension for free online via IRS Free File, a public-private partnership between the IRS and several tax software companies.   

For the 2025 season, you can use IRS Free File for returns if your adjusted gross income, or AGI, was $84,000 or less in 2024. But there’s no income limit to file an extension, Lucas said.

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