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SAN JUAN, Puerto Rico – Juan Camacho thought he would visit Spain, take a university literature course and get to sleep in more when he retired after nearly four decades as a teacher.
Instead, the 70-year-old is working as a second-grade teacher's assistant to supplement his pension as the U.S. territory's government warns its public retirement system could dry up by next year amid an economic crisis.
"A person dedicates their entire life to public service ... and then at the end of the road, there's no guarantee that we're going to live the last years of our life with dignity," Camacho said.
Puerto Rico's economic crisis has left the public retirement system with a more than $40 billion deficit and that's pushing elderly people who depend on it back into the workforce. The situation threatens to plunge the island's rapidly aging population into poverty as it already struggles with high taxes, expensive medical bills and increased utility rates.
The government is Puerto Rico's largest employer, and its three main retirement systems pay pensions to more than 150,000 former government workers. The systems' combined liability grew by $10 billion from 2009 to 2013, prompting the former governor to increase retirement ages, reduce benefits and increase employer and employee contributions.
But because of economic problems, the government has not paid most additional contributions, angering retirees who already believe their money was mismanaged when it was invested in risky bonds. Independent audits have shown the pension system was long mishandled and that past governments increased worker benefits without adding money to the system. Things got worse as the number of pensioners grew, their salaries rose and they lived longer.
"Now there are people who are 80 years old and are still working because they cannot afford to stay at home," said Roberto Aquino Garcia, president of the Association of Retired Puerto Rico Government Workers. "This crisis has been a disaster from an emotional viewpoint."
Puerto Rico's average public pension is roughly $1,100 a month, but more than 38,000 retired government employees get only $500 because of the type of job they had and the number of years worked, he said. Many now struggle to find work given their age and the few jobs available on an island of 3.4 million people with 12 percent unemployment, higher than any U.S. state. Eighteen percent of Puerto Rico's population is 65 years or older, and nearly 450,000 of them are retired workers who receive Social Security.
Edwin Rosario, a 68-year-old security guard, said he doesn't plan to retire because his mother is among those receiving $500 monthly. She is in her 90s, has Alzheimer's and is cared for in part by his sister, who gets the same amount.
"We have to prepare ourselves because we don't know what's coming," Rosario said, his eyes filling with tears. "Even if they touch $1 of her pension, that's too much. What she receives is close to nothing."
Teachers and police officers are especially at risk because they don't collect Social Security, depending solely on their pensions.
Newly elect Gov. Ricardo Rossello has promised to protect government retirees and recently approved a law seeking to boost the public pension system with private investment. But many retirees worry it won't happen soon enough.
Meanwhile, a federal control board Congress created last year to oversee Puerto Rico's finances demands new austerity efforts. It has suggested a 10 percent cut in pensions to generate some $200 million in savings, but that would also slash individual payments to below $1,000 a month, said Natalia Palmer Cancel, director of Puerto Rico's Administration of Retirement Systems.
"That is definitely worrisome," she said. "Clearly, retirees would be living below the poverty level."
The board also has urged salary freezes and elimination of jobs through attrition. Officials say such moves would only increase the number of government retirees and shrink the payroll, diminishing contributions to an already wobbly system.
The situation worries retirees such as former police captain Rolando Padilla, who joined the force at age 19 and retired in 2013 at 54.
He has considered getting another job, noting that some former co-workers are security guards and a close friend drives a school bus.
"You barely survive with the pension," he said, adding he doesn't like the idea of needing a job. "You retire to rest and enjoy your family. You don't retire with the idea that you're going to keep working."
The pensioners say they worry about their health as they struggle to return to work. Some formed a nonprofit organization and hired a law firm that represented retirees in Detroit in hopes of pressuring the control board to reconsider pension cuts.
"We're going to have a humanitarian crisis," said Jose Marin, spokesman for the Pro-Retiree Movement. "Retirees nowadays are being forced to pick between buying food and buying medicine."
Camacho said he's grateful he hasn't reached that point, but he now goes to the movies less and wears jeans and T-shirts more to reduce dry cleaning bills. He's also given up on taking the university literature courses he looked forward to when he retired 10 years ago.
"There are no loans for that kind of dream," he said. "Things are going to get worse than they are right now. People in Puerto Rico are going to suffer."
Danica Coto on Twitter: www.twitter.com/danicacoto