Social Security Reform: Implications for Women s Retirement Income

TitleSocial Security Reform: Implications for Women s Retirement Income
Publication TypeReport
Year of Publication1997
AuthorsUnited States General Accounting Office,
InstitutionWashington, DC, U.S. General Accounting Office
KeywordsEmployment and Labor Force, Retirement Planning and Satisfaction, Social Security, Women and Minorities

Question: evaluate (1) why women s benefits are lower than men s under the current Social Security system, (2) the possible differential effects on women of the new privatization reform proposals, and (3) what can be done to minimize the possibly negative effect on women of certain elements of the Social Security reform proposals. Finding: Using the NIA-funded Health and Retirement Study, as well as citing some research conducted by NIA-funded grantees, GAO noted that women s Social Security benefits are often lower than men s due to lower wages and fewer years in the workforce. Some of the proposals to reform Social Security by shifting responsibility of saving for retirement to individuals via accounts funded as a proportion of their salary could make the difference between men s and women s benefits worse. For example, greater risk aversion among women could lead to lower investment returns; further, women could face substantially lower benefits (and hence a lower likelihood of retirement income adequacy) if annuitization formulae take their longer life expectancy into account. Recommendation: Improve information about investment objectives and financial planning to reduce differences in investment strategy and improve retirees ability to manage their assets. Consider mandatory annuitization to reduce the possibility of individuals outliving their savings. Use unisex lifetables to ensure those with comparable savings at retirement have comparable monthly benefits.

Endnote Keywords

social Security benefit claiming/labor force/women/retirement income / United States./privatization

Endnote ID


Citation Key5348