Social Security risks greater for women
By Pamela Brogan
Gannett News Service
WASHINGTON — Women have more at stake than men in President Bush's plan to make individual investment accounts part of Social Security.
Kevin Pieper • Gannett News Service
Women are more likely to receive Social Security benefits, live longer after retiring, have less money and rely more heavily on the government retirement insurance program, according to federal and private data.
Connie Jones, 78, of Bull Shoals, Ark., plays her dulcimer in her apartment. Jones, who sold her car so she could buy a new refrigerator, says she relies solely on Social Security for income.
Some groups representing women and minorities say individual investment accounts would transform Social Security and its guarantee of lifetime benefits into a risky investment plan.
"Privatization is about taking benefits away from women," said Heidi Hartmann, president of the Institute for Women's Policy Research. "I'm disgusted that this is not talked about more. I guess it's because President Bush is setting the agenda, and he doesn't want to talk about how women and men use Social Security."
Others say Bush's plan would be no more risky for women than the current system.
"Women are smart enough to decide for themselves whether they want a personal account," said Leanne Abdnor, executive director of Women for a Social Security Choice and a member of the bipartisan panel Bush assembled in 2001 to propose solutions to Social Security' s looming financial problems.
"The existing system is a risk because the country is dependent on elected officials to decide their level of benefit," Abdnor said.
Social Security is the only source of income for one of every four women 65 or older, according to the Institute for Women's Policy Research.
Women also depend 10 times more heavily than men on the parts of Social Security that pay benefits to widows and widowers and to the spouses and children of disabled workers. Bush's plan is silent on how those benefits would fare under his proposal.
That's a particular concern for black women, who are disproportionately single and in poor health and are twice as likely as white women to receive disability benefits.
Women rely on Social Security more than men do. In Hawai'i: • Some 20 percent of adults receive Social Security benefits, including 22 percent of women and 17 percent of men. • Women represent 56 percent of all people 65 and older who rely on Social Security benefits. • The typical recipient of a Social Security widow's benefit receives $829 per month. Under one proposal to restructure Social Security, kindergartners today would receive 45 percent less than under current law. If the same cut were to take effect currently, the typical widow would receive $456 per month. Source: National Women's Law Center
Maya Rockeymoore, vice president of research for the Congressional Black Caucus Foundation, said individual accounts "represent a threat of deep poverty because they reduce the 'guaranteed' aspect of Social Security."
Hawai'i women depend on benefits
Opponents of Bush's plan also note that women typically earn less than men, which makes many women reluctant to support any changes to Social Security. Currently, workers who earn lower wages get a larger percentage of their income back after they retire than do higher-income workers. Social Security benefits also include a cost-of-living adjustment.
Income from personal investment accounts would not favor lower-income beneficiaries, aren't guaranteed to last a lifetime and don't offer a cost-of-living adjustment.
"I don't think we should change Social Security, but I do think we should encourage young people to save," said Connie Jones, 78 of Bull Shoals, Ark., who relies solely on her $792 monthly Social Security check. "Social Security allows me to live independently."
Bush's plan would affect only workers who are age 54 and younger. Jones and other current retirees wouldn't be affected by the accounts, but their opinions have helped shape the debate over the proposal.
"I support investment accounts, but only if they are in addition to Social Security," said Jones, who raised a family and then worked for 15 years as a dietician after her marriage ended. "I want Social Security to be there for younger women."
Some younger women, including Sandra Jones, 27, of Des Moines, Iowa, say creating personal accounts would be less risky than doing nothing to change Social Security.
"I'm not afraid of the small risks," said Jones, a state lobbyist. "My generation is going to get the short end of the stick unless we do something. It really frustrates me when I hear politicians say that 70 percent of the benefits will still be there in 40 years if we don't do anything. Are you kidding me? Seventy percent is not good enough."
Bush would let younger workers invest up to 4 percent of their first $90,000 of income in personal accounts consisting of a limited array of stocks and bonds. When those workers retire, their Social Security benefits would be reduced by an amount roughly based on money accrued in the personal accounts.
Alma Morales Riojas, president of MANA, A National Latina Organization, said private accounts probably wouldn't benefit Hispanic women, the poorest of all workers, because they don't earn enough to set aside money for investments. In addition, Riojas said, many Latinos don't trust financial institutions.
Riojas said Latino women also live longer than white or black women, according to 2002 census data. As a result, Latino women depend on Social Security to a greater extent for retirement income. Without it, 61 percent of Latino women 65 and older would be living at or below the federal poverty level.
"Social Security is not just a safety net for us but a matter of survival," she said.
The details about how Bush's proposal would handle a minimum retirement benefit if stocks plummet aren't clear. He also hasn't said how his strategy would deal with disability benefits.
That's exactly why Cathie Holt, 44, of Warner Robins, Ga., opposes the president's plan. Holt was earning a six-figure salary in pharmaceutical sales before a 2001 car accident left her with multiple disabilities. She now gets $1,500 a month for herself and $800 a month for her 6-year-old daughter in Social Security disability benefits.
"I don't want to be the generation that is the guinea pig for privatization," said Holt. "I have dreams for my child, and I know that college is still a possibility for her because of Social Security."
