INCREASING WOMEN'S INCOME
Social Security

Social Security is a critical safety net for people of all ages, from all income levels and all racial and ethnic backgrounds. Created in 1935, Social Security provides cash benefits for retirees, survivor benefits to family members of workers who have passed away, and benefits for disabled individuals and their families. The Social Security system is tied to the employment and earning history of individuals, and is funded by payroll taxes paid by both the employee and employer on the first $102,000 an individual makes. Nearly two-thirds of retirees count on Social Security for the majority of their retirement income. More than 30 percent of Social Security recipients receive survivor or disability benefits.

Social Security is a particularly vital program for women. Fifty-six percent of all Social Security recipients are women. Almost half of all elderly unmarried women receiving Social Security benefits rely on the benefits for at least 90 percent of their income. With older women less likely to have a significant income from their retirement pension than men, Social Security serves as a necessary source of income. And even for women who do have pensions, Social Security provides a critical safety net.

There has been much discussion about the Social Security system being in ‘crisis’ and if and how the Social Security system should be reformed. One response to the belief that Social Security is in crisis is to reform Social Security by creating private accounts. Private accounts are individual accounts that would allow people to invest their Social Security taxes in financial markets. When financial markets go up—investments would go up, and when financial markets experience a downturn, investments would lose money. Advocates of private accounts argue that individuals investing the stock market would receive more money through investing than from social security alone, and that individuals would be able to leave their accounts to family members upon their death.

Advocates for maintaining the current Social Security system do not support privatization. They argue that it would negatively affect the well-being of women and families. They point out a number of problems with privatization:

• Private accounts would result in steep benefit cuts and cost trillions of dollars to create and maintain.
• Privatization will not fix the long-term funding needs facing the system.
  Individuals who choose to put their money into private accounts would have their Social Security benefits dictated by the changes in the market, thus losing the guaranteed, inflation-adjusted, lifetime benefit of Social Security.
• Because women earn less over the course of the lifespan compared to men—for a variety of reasons, including the wage gap, part-time employment, and leaving the workforce to take care of family members—their contributions to their own account would be limited.
• Unlike the current system, which provides a guaranteed lifetime benefit, private accounts only contain the amount the individuals contributed to them. There is the risk of individuals outliving the amount in their account.
• Private accounts may not protect individuals and their families in cases of disability or provide survivor benefits upon death.
• Unlike current survivor and widow benefits, private accounts can be inheritable by anyone the individual chooses. Therefore, if a husband or father does not leave his account to his spouse or daughter, women may lose their survivor and widow benefits.

YWCA Position
Increasing Women’s Incomes includes policies that contribute to the economic empowerment of women. This includes but is not limited to policies that address the minimum wage, pay equity, social security, and budget and tax policy.

The YWCA opposes any plan that would replace Social Security benefits with privatized Social Security accounts and supports strengthening Social Security to ensure that women, girls and their families will continue to have full, guaranteed, inflation-adjusted Social Security benefits.