Blog About It: Elder Economic Security

Today marks the start of Older Americans Month. WISER is partnering with Wider Opportunities for Women on its National Elder Economic Security Initiative: What does elder economic security mean to you? We encourage you to answer this question by leaving a comment on WISER's blog, or on the National Elder Economic Security Blog. 

Old Age Is No Place for Sissies

Life Expectancy

While a long life can be a wonderful gift, a long life in poverty or near poverty is not so wonderful. Today, an average woman’s life expectancy at birth is 80.4 years, compared to 75.2 years for an average man. If a woman lives to age 65, she can expect to live until age 85 ― about three years longer than a 65-year-old man. 

Marital Status

Many widows face poverty for the first time in their lives. Between the ages 75–84, only 34 percent of women are married with their spouse present. For women aged 85 and older, only 13 percent are married with their spouse present. In contrast, 70 percent of men aged 75–84 and 56 percent aged 85 and older are married with a spouse present.

With the death of a spouse, women often experience a steep drop in income. When a woman becomes a widow, she stands to lose a significant amount of income from her spouse’s pension and even from Social Security.

Poverty

The poverty rate for all women age 65 and older is 12 percent. Single women in this age group are at a much higher risk of poverty. Over 20 percent of single white women are living in poverty; the rate is double for single African American and Hispanic women. 

Portion of Single Older Women Who Are Poor and Near Poor
	Below 100% of Poverty (Threshold $9,669)	Below 150% of Poverty (Threshold $14,504)	Below 200% of Poverty (Threshold $19,338)
Age
65+	19.1	45.9	61.5
65-74	18.4	38.6	53.4
75+	19.5	47.1	66.5
Note: The poverty thresholds shown in this table are for 2007,  calculated in 2008.  Source: CPS, Table POV 01, 2008.

Retirement Income

The median annual income for women age 65 and older is not quite two-thirds of what men the same age are receiving ($14,021 compared to $22,323). Social Security is intended to replace approximately 40 percent of an average earner’s wages, but many women rely on it as their primary or only source of retirement income. This is one of the major reasons why so many women are poor or near poor.

In theory, women should be saving more money than men because they live longer and will need money to support themselves and pay for the rising cost of health care and prescription drugs.  Yet in reality, they are not able to save the vast amounts that are needed due to diverse work patterns and caregiving responsibilities that require them to move in and out of the paid labor force or to work at part-time jobs where they are less likely to have retirement plans or savings.

As a result, millions of women are vulnerable to outliving their assets and facing the real possibility of poverty.

We can hope that public policymakers will adopt changes to prevent poverty in old age, such as providing caregiver credits, improving the Saver's Tax Credit, developing a better system of financing and providing long-term care. However, women must learn to make the most of the existing system and make the best financial decisions toward securing their futures. 

So, what does Elder Economic Security mean to you?