Soon after we had our daughter, I read that elderly women receive far lower Social Security benefits than men due largely to motherhood. Having just become one, I visited the Social Security Administration website. At the top of the page, they reassured me "Social Security is neutral with respect to gender."
I proceeded to use their calculator to find out if my Social Security benefits would be affected if I were out of the workforce for five to seven years to care for our daughter.
Response? I would lose a half-million dollars. That didn't sound so "gender neutral" to me.
And that's because Social Security is neutral in name only; it is sexist by design. Social Security was designed in the late 1930's by a council that used the beliefs of the time about men, women, money and work to guide their recommendations. Their beliefs were far from neutral and instead included:
Social Security still operates as it was intended to in the late 1930's. My own benefits are calculated based on the number of years I am employed and the amount I earn. The more years and the higher the wages, the higher my retirement benefit. The years I spent out of the workforce with our baby add several zeroes to the calculation, dragging down my benefit amount. The years I may spend working part-time or in a lower paying flexible job to care for family also decrease my benefits. While more women than ever are employed today and more fathers are caregivers, it is still far more common for women to give up earnings to care for family than for men, so women still end up with lower Social Security benefits.
Similarly, wives are still more often the lower earner in a couple. And as the lower earner in my family, at retirement I will be eligible to take either a "spousal benefit" equal to 50% of my husband's benefit or the benefits I earned on my own, whichever is greater. So I could work for pay for many years, contributing taxes to Social Security, yet if he earns more I will still end up taking the same 50% benefit I can get if I'm never employed at all. Employment doesn't get me any greater Social Security benefit, helping to "taking away my urge to go back to work."
When my husband and I retire, we will receive 150% of his benefit amount in two checks. One check for 2/3 of that total arrives in the mailbox in a check to him, his 100%. Thanks to Ms. Ginsberg, another check arrives for me for 50% of his benefit, but I control just 1/3 of our total. If we get divorced, he still gets his check for 2/3 of that total benefit. I will have to get by on my Spousal Benefit check for 1/3 of the total, because remember I'm supposed to be "used to doing my own housework" while he "has to go to a restaurant."
What is even more infuriating is that two simple changes, both of which have been proposed for years, could make Social Security equitable for men and women, spouses and anyone who gives up earnings to care for family members.
One, add a caregiver credit for a finite number of years a person spends out of the workforce caring for children or for disabled or elderly family members. As recently as April, Michael Hiltzik wrote about this common recommendation, which was also re-introduced into Congress in June 2011, in the Los Angeles Times. Instead of zeroes for the years I stayed out of the workforce, I would be credited for, say, $20,000, about half the median wage in the United States. When I retire, instead of having five zeroes averaged into my calculation, I have credits for every year and benefits comparable to anyone who has a consistent employment history.
Two, lose the spousal benefit and replace it with "earnings sharing" for spouses. "Earnings sharing" would add the two spouses' incomes together and then credit half of that total to each spouse within Social Security. For example, in a year that I was out of the workforce, if I received the Caregiver Credit for $20,000 and my husband earned $54,000, then our total credits for Social Security would be $74,000. We would split them down the middle and each of us would receive $37,000 credit toward Social Security for that year. Then at retirement, we each would receive a check for half of the benefits earned during the marriage. In the event of divorce, our credits would already have been divided equally during the marriage and our respective checks would still reflect that split. Earnings sharing is not a radical notion. A member of the Social Security Council proposed it back in the late 1930's. The council rejected it in favor of the "wife's benefit" paid to the husband to care for his wife as his dependent, so he "would enjoy the security of the additional income."
Social Security is front and center in our political dialogue. Now is the time to make changes so that the Social Security Administration can honestly announce on its website "Social Security is neutral with respect to gender -- by design."
Catalyze!
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Social Security faces enough assaults from the right. It hardly needs ridiculous accusations of "sexism" added on top of that.
Kristin
As currently laid out working familes where both the husband and wife work with equal and or high incomes will pay more in taxes than if they were single. One remedy to this was to create "married filing jointly" category, but there a couple looses some of the deductions/benefits of married filing singly. In short the tax code is designed for a primary breadwinner who brings in all or most of the family income. Long as any income earned by the spouse is marginally less, the family benefits. However once total household income reaches certain rates they are penalised.
This is the problem. Our middle class are too busy cutting what each other gets than to focus on the leaders and what they are doing.
My husband worked 48 years but only 35 years counted toward his benefits. A lot of one earner spouses do that and that helps take care of the spouse.
Both parties way lay each other when we should be yelling in the halls of congress about jobs and the way they are handling Social Security and Medicare, etc.
Most would qualify for food stamps if they didn't get the spousal benefit.
When both earners of a family retire they each can draw on their own Social Security benefits or draw half of their spouse's Social Security benefits whichever is larger.
Most earn between $32,000 and $49,000 wages. It takes a lot more from Social Security to pay the two income workers.
To pay two full Social Security retirement benefits will cost more in the long run than to pay half of the non working one earner spouse's benefit.
To the best of one's knowledge the United States in contrast awards benefits to any surviving spouse of a "long term marriage" (eleven years or over as per current law IIRC), regardless of her income or need.
Many of them have a private pension, plus a TSP that is like our 401k and we the taxpayer match it, plus other retirement income.
The elected government never put their coworkers down and try to cut their benefits. A lesson for us all.
EU doesn't have the medical expenses and other expensive living costs.
Yes, if you were married for 10 years you can draw off of that spouse's retirement benefit for Social Security, even if you have divorced and remarried. You may not want to, you may be better off to take draw your own benefits or your 'new spouse's benefits whichever is higher.
The Nordic countries are getting very close to gender equality on these issues, and will likely reach this in the next 10 years.
They all now exceed the US in standard of living (Norway is approaching TWICE the US standard of living) and their birth rates are the highest in Europe and are increasing more and more as gender equality gets closer.
If people want to be stay-at-home parents that choice is still available to them but the costs of that are paid by the family, not by society at large. It's not fair to make 2-earner/2-parent couples subsidize stay-at-home parents. And it's not good policy because 2-earner/2-parent families are the healthiest for children; we should not be discriminated against them. (2-earner/2-parent families being those where the man and woman each take responsibility for half the unpaid work, including paying someone else to do it if they want to outsource their half). And both take responsibility for earning.
There are a lot of things that make the world a better place and most things are not fair. How fair was it to bail out the banks? How fair was it to let them get by with criminal acts? How fair is the tax code? How fair is it that a baby is born into poverty and another is born to great wealth?
If you max out a 401k, you don’t have to pay income taxes on the money until you sell. So that tax money earns you money from investments until you cash it in.
People who own expensive homes get to deduct the interest on them, but most of the middle class don’t pay enough interest to file any thing but a standard deduction. So the higher paid get a big tax break there.
Today with high divource rates and subsequent remarriage you have instances where two or more spouses are making SS claims upon one man's payments.
In the larger scheme of things SS takes in far less funds that it has to pay for it's various schemes. It isn't just the wage earners "pension", but current or former spouses as well, death benefits, benefits paid to minors, disability and so forth. In essence it is one giant redistribution of wealth from one class of persons to another.
Benefits are also figured on how old you are when you retire. You give up 1/4 of your benefits to retire at 62 and get full retirement benefits at 66 retirement age, now. If you want to push your luck and work until you are 70 you will get a lot more money benefits.
If you work 35 years you could wait until age 29 to start work and be eligible for full benefits at 67..My husband worked 46 years and didn't get a penny more than if he had worked for 35 years.
If he dies first, I will get his full check, but will lose mine.
Averaging in zeros for years without income reported for the benefit period is probably (would have to look it up) one of the reasons working women who have gaps in their qualifying employment period receive less. In some EU countries this is adjusted by giving credit for women who have given birth to and or reared a certain number of children. In short the government pension scheme compensates women for their lot, will also providing an incentive for females to have children. But of course the USA's SS system in "gender neutral", so .....
Do our children want us to live with them when we are old?
Do they want to inherit anything? If they do they had better leave Social Security alone. It is the only thing keeping the middle class elderly losing everything.
They won't have room to gripe if they push to ruin Social Security. They will work until the day they die, too because there will be no retirement for them.
In the 1930s it was men who were the "benevolent" caretaker of women. It is quite right that women can and should be self determining -- and that all the work they do, paid and unpaid, should be factored into their well-being (and a man's as well if he is caring for a child or relative).
The connection we all have to each other is pretty essential. Without it, we'd all be at a loss someday. While we can't say caregiving is a job in an organization, it is essential.
So, is one of our values that we all should receive care for free..nothing?
We should all freeload on the kindness and sacrifice of others?
Women and men shouldn't see their care work as valuable or necessary?
They can stop at any time?
It is not skilled, or essential to the well functioning society?
It is a market failure that our work structures, our care policies and our BELIEFS have not progressed beyond the defensive, combative rhetoric of demonizing women's lives, ideas or "choices" or the mental framework of accusatory politics.
Times have changed. Our debates need to change too.
There are those who kick and those who get kicked.
Those things never change.
Does it matter that motherhood is a choice (and in some value systems, it is decidedly NOT that)? Being married and career paths are often choices as well.
We have a compensation system for unemployment known as Unemployment Insurance. To date..THERE IS NO COMPENSATED INSURANCE PROGRAM FOR FAMILY CAREGIVING -- not for caring for your own or a family member's illness, not for caring for a newborn or an elderly parent. STUFF HAPPENS IN LIFE. Just like with a car, a house....we should have a means for planning for life events that are shared expenses (like our auto insurance premiums). Social Security is an insurance program --- we pay into it. The government is returning our investment and "premiums" to us.
Our beliefs about work -- what it is -- or isn't -- what is a "job" -- are important ones to put on the table, and obviously, assumptions about the role of government, the workplace participation and abilities of women as workers and fathers as caregivers (and our perceptions about both of these) have shifted dramatically in the last century and we need to discuss those shifts and reach consensus as a country.
1. caregiver credit
2. earnings sharing
I agree with #2. That's totally fair. Your total combined income for a year is $54,000, split it down the middle. But that will decrease your husband's benefit at the end, and overall, the 2 of you are worse off.
But #1? No.
When we had our daughter 5 years ago we had a plan, she would cut her hours back to barely part time, just enough to keep her foot in the door, quitting when things where just starting to go south wasn't a good idea even though we could afford it. So we shifted our hours so one of us is always at home and it has worked out pretty well.