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Social Security reform proposals raise concerns for older women

Several popular plans for the revamping the Social Security system contain clauses that could fail to significantly protect older women, according to research reported in the February 2005 issue of The Gerontologist (Vol. 45, No. 1). The study discusses the potential effects of implementing several different minimum benefits scenarios in Social Security, which have accompanied proposals to reform the program.

While Social Security does not currently have a minimum benefit, this was not always the case. It was in place from 1939 until 1981, when it was eliminated due to budgetary constraints and claims that it favored housewives and individuals with limited work histories.

Author Pamela Herd of the LBJ School of Public Affairs at the University of Texas, Austin, examines the three most common proposals for the reinstatement of minimum benefits. Her goal was to project how women who reach age 62 between 2020 and 2030 would fare under the three different designs. The analysis was made using data from the 1992 Health and Retirement Study.

The minimum benefit accompanying privatization proposals, which requires 40 earnings years for a poverty-level benefit, fails to cover significant numbers of vulnerable women. Also, benefits distributed based on marital status are not as effective at protecting poorer women - as well as a new generation of women that is less likely to be married - than are minimum benefits where eligibility is tied to U.S. residency or simple Social Security eligibility.

The research was supported in part by the Center for Retirement Research at Boston College pursuant to a grant from the U.S. Social Security Administration funded as part of the Retirement Research Consortium.


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Contact: Todd Kluss
tkluss@geron.org
202-842-1275
The Gerontological Society of America
14-Feb-2005


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