Your Financial Future:
Improving Social Security Benefits For Women
While many Social Security reform proposals would result in lower benefits for women, there are options that address some of the current program’s structural deficits and increase women’s benefits. The purpose of presenting some of these is to offer options for consideration.
- Eliminate the “motherhood penalty,” by granting caregiver credits for up to five years spent out of the full-time workforce to care for children. (A spouse’s earnings would not affect eligibility for the credits.) Granting the credits potentially eliminates five additional “zero” years from the Social Security bene- fit calculation.
- Provide credits for caregiving by allowing up to four additional “drop out” years and “care” would include care for family members other than children.
- Increase the widow’s benefit from 100 percent of the couple’s higher-earner benefit to 75 percent of the couple’s combined benefits. This proposal addresses the fact that many older women are not poor until their spouses die. Since typically the husband’s income has been higher, a widow who worked long enough to be eligible for benefits of her own essentially gets no credit for her earnings.
Expand the Special Minimum Benefit:
- Change the Social Security benefit calculation formula to increase the minimum benefit, which was designed to compensate long-term, low-wage workers, predominately women who stay in such jobs for most or all of their work lives.
Improve Benefits for Divorced Women:
- Increase benefits for lower-earning divorced spouses from 50 percent of the former spouse’s benefit to 75 percent.
- Reduce the number of years of marriage needed to qualify for the spousal benefit from the current ten years to seven years, as long as combined marriage and work history totals ten years.
Why It’s Important
Social Security is the first line of defense for women against poverty in old age. Clearly, women have a strong stake in ensuring the financial solvency of the program and making sure that the broad range of benefits remains. Women need to stay focused on the proposals and the debate to reform the current system.