Once Again, It's Your Issue: Social Security
by Betty Soldz
It is expected that Congress may address changes to Social Security this year. It is imperative for women to understand how the system works, the inequities for women, the proposed changes to the system, how they will be affected by the proposed changes and then to become actively involved in the process of protecting it for themselves and their families.
Social Security (S.S.) is a vital safeguard against poverty for older women who make up approximately 60% of S.S. beneficiaries at age 65. Because women live about seven years longer than men, they make up 71% of recipients by age 85. Women tend to earn less than men and, on average, spend less time in the workforce; therefore, many enter their retirement years totally unprepared financially. Due to home and caregiving responsibilities women spend an average of 11.5 years out of the workforce. Some work part-time and many work at low paying jobs. Approximately 58 % of women today still hold sales, service and clerical jobs — low wage positions which insure these women will have lower S.S. benefits and quite likely no private pension. By the mid 1990's only 18% of women over age 65 were receiving private pensions. Those who were single or divorced were usually substantially poorer than married women. Without the protection of Social Security many will face financial insecurity in their later years. In fact, one out of four older women depend on Social Security for 90 % of their income and many of these women live in or near poverty.
It is little known that Social Security is not only a social insurance which protects elders who may have little or no other income but that it is also a family insurance policy. One-third of Social Security benefits go to the disabled, surviving spouses and to children who have lost a parent.
When Social Security was designed in 1935 family lifestyles were very different. The husband was the wage earner and the wife the unpaid homemaker. Working women are treated unfairly under the system today. Although the majority of wives are now in the workforce and paying into Social Security, when they retire their benefits may not be any larger than if they had never worked. Because women earn less and many are paid less for equal work, their benefits are often lower than a spousal benefit and they will receive only benefits based on their husband's income I believe that even though Social Security provides important benefits for women there are inequities that need to be addressed. This is just one of them.
Other biases that persist against women in the S.S. system are the discrimination against caregivers and those who are divorced. Because benefits are wage based, women who take time out of work to give care will be penalized because they will have a $0 income year/years posted to their account In fact, a recent survey commissioned by MetLife's Mature Market Institute found that lost employment for caregiving will translate into an average annual decrease in Social Security benefits of $2,160. Divorced women, if married ten or more years, receive half of their ex-spouses benefit. The average monthly spousal benefit in 1994 was $361 for divorced women age 62 or older; this is so little many women without other income will be doomed to poverty. If a woman is married, the couple receive the full husband's benefit plus a spousal benefit of half of his benefit. This may not be a lot but it is usually enough to keep them out of poverty. (If the wife's benefit is more than her spousal benefit, she will receive her own benefit.)
Other proposed solutions are to lower the amount of Social Security a person receives or to raise the social security tax or to continue to raise the age when a person can collect full benefits. Since only a small number of women now receive pensions from their employer it would be detrimental for them to receive less Social Security. To continue to raise the age for full benefits seems ludicrous at a time when we see so much ageism in the workplace. Older women who lose a job are not very likely to find a comparable job, if any job at all. What will they live on?
The above are only a few of the proposed changes to Social Security — I am sure there will be many more this year — but enough, I think, to show that women need to be watchful when Congress takes up this issue. While it may be true that Social Security needs to be strengthened to protect it for our children and grandchildren, we must be cognizant of the importance of reducing poverty among older women and preventing poverty for others. We all have much to lose!
President Clinton stated the issue quite well recently: "We must maintain universality and fairness ... When we judge any plan to save Social Security we need to ask whether it cuts the poverty rate among single elderly women and other groups in our society." Let's join together and make sure that this is the outcome!
Ask how they stand on changes to Social Security and let them know you need to count on them to protect women, their families and the disabled.
Many organizations such as: OWL/The Voice of Midlife and Older Women, American Association of University Women, Business and Professional Women USA, the National Council of Negro Women, AARP, The National Congress of Seniors, Gray Panthers and many more will be watching and addressing Social Security reform. Most of these organizations can be found on the Internet.
Senator Harry Reid, Assistant Democratic Leader on Social Security