WASHINGTON, DC — Speaking at a Capitol Hill press conference at which Senator Lindsey Graham (R-SC) introduced The Social Security Solvency and Modernization Act, Carrie Lukas of the Independent Women’s Forum delivered the following statement:
I thank Senator Graham for reigniting a debate over Social Security’s future — a debate critical to women. Women have the most at stake in the future of Social Security. We live longer than men, and generally have lower retirement incomes. In fact, 27 percent of women over age 65 depend on Social Security for 90 percent of their retirement income.
Because we disproportionately rely on the system, women should be especially concerned about Social Security’s unsustainable course.
Without reform, the payroll tax increases that will be necessary to prop up the system will lower women’s incomes and damage their job prospects. Payroll taxes are collected starting with the first dollar earned. On average, women hold lower-paying jobs, so lose a greater portion of their income when payroll taxes rise. Payroll tax increases make hiring new employees more expensive, stifling job creation, which is critical to women who tend to move in and out of the workforce to a greater degree than men. The benefit cuts that would be necessary if Social Security’s financing problems are not addressed would also be devastating to those women who rely on this income at retirement.
The good news for women is that with timely action Social Security’s problems can be solved. By giving employees the opportunity to place a portion of their payroll taxes into a personal retirement account, policymakers can help women enjoy greater income and independence at retirement.
Even when they take time away from the workforce, women would benefit from the compound interest and returns generated from investing in bonds and mutual funds. This opportunity to build a nest egg over a lifetime is particularly important to those women who work in part-time positions that do not offer retirement savings plans.
On behalf of the Independent Women’s Forum, I would like to again thank Senator Graham for his leadership on Social Security, and for refocusing the nation’s attention on a key issue for American women.
The Independent Women’s Forum is a nonprofit, nonpartisan organization. It was founded in 1992 to help educate policymakers and the public on issues affecting women.