Women are at greater risk of economic insecurity in retirement than men. The poverty rate for women 65 and older is nearly double that of men. This is due, in part, to women’s employment and family patterns, which reduce their lifetime earnings and limit retirement savings and future retirement income. Because women typically earn less than men and spend more time out of the workforce for caregiving than men, women reach retirement with fewer pension benefits and retirement savings (as well as lower Social Security benefits). In 2015, one positive change occurred that will boost women’s retirement security, one potential threat to the financial security of women with disabilities was forestalled, and some exciting possibilities for progress were created.
First, the positive development: under the Supreme Court’s 2015 decision in Obergefell v. Hodges, all same-sex married couples are entitled to spousal Social Security benefits, wherever they reside. Although the Social Security Administration is still in the process of implementing this historic decision, this change will have a tremendous impact on the retirement security of LGBT women who are married, who even after the Supreme Court’s 2013 decision in United States v. Windsor, may have been precluded from receiving Social Security benefits as a spouse or widow if their state of residence did not recognize marriage equality.
Further, with depletion of the Social Security Disability Insurance trust fund looming, there was a risk that these modest but critical benefits, which are especially important for women of color and their families, would be cut. However, as part of the Bipartisan Budget Agreement, Congress ensured continued funding for this important program until 2022 without significant changes to the benefits.
In addition, some proposals that would take steps towards increasing women’s retirement security were highlighted – or introduced – in 2015. In July, Senator Patty Murray released a report highlighting the gap in women’s retirement security [PDF]. The report pointed to potential improvements to Social Security benefits for spouses and widow(er)s, which would primarily help women, who are more likely than men to rely on their spouses’ Social Security benefits. This and other Social Security benefit improvements were included in the RAISE Act, introduced by Senator Murray in November 2015.
Senator Murray’s report also pointed to some policy changes regarding retirement savings that would particularly benefit women, including extending spousal protections to retirement savings in 401(k)-type plans and requiring employers to allow long-term part-time workers to participate in retirement savings plans. In September, Senator Murray introduced the Women’s Pension Protection Act of 2015, which would enact several of those changes. The bill was cosponsored by 14 Senators, and was introduced in the House of Representatives by Congresswoman Jan Schakowsky.
Millions of older women around the country risk financial hardship in retirement. For these women, and their families, here’s hoping that these – and other – policy improvements come to fruition in 2016.