Retirement security is a real challenge for everyday Americans. The reduction of pension availability, the unpredictability of Wall Street and low wages that make it hard to put money away are all reasons why. But it is particularly so for women.
A report released earlier this year by the National Institute on Retirement Security (NIRS) found that women are 80 percent more likely to be impoverished in retirement than men. For women 65 and over, the study shows their average income is 25 percent less than men. And that grows to 44 percent for women age 80 and over.
“It is well documented that the nation faces a retirement savings crisis, but the pain is particularly severe for women because we need a bigger retirement nest egg than men thanks to our longer life expectancy,” said Diane Oakley, NIRS executive director and a co-author of the report. “This new data is troubling – its shows that a woman’s nest egg is substantially smaller than a man’s and that we’re not making real headway towards closing the retirement gap.”
While women are more likely than men to work for an employer that offers a retirement plan, according to the latest numbers, there is a gap in eligibility that limits women’s participation in these plans. Women’s higher rates of part-time employment and shorter job tenure make it more difficult for them to meet eligibility requirements.
Consequently, women are particularly dependent on Social Security benefits. But this retirement safety net has been a constant target of anti-worker advocates who want to cut benefits. That’s why a proposal introduced by President Obama last week was such welcome news. He said the federal government should expand benefits, not reduce them.
As he told a crowd in Elkhart, Ind., “A lot of Americans don’t have retirement savings. Even if they’ve got an account set up, they just don’t have enough money at the end of the month to save as much as they’d like because they’re just barely paying the bills.”
Raising benefits can be accomplished by dropping the income cap that currently limits such contributions to the first $118,000 a year a person owns. There is no reason those earning more shouldn’t be contributing more.
That’s how elected officials can make America a country that’s fair to all.