WASHINGTON, DC — The Independent Women’s Forum today released “Golden Girl Power: How Social Security Reform Can Make Women More Financially Secure and Independent,” a paper that urges policymakers to reform Social Security to include personal retirement accounts as soon as possible.
“These changes are particularly important for women,” says Carrie Lukas, IWF’s director of policy. “Women take time out of the workforce to care for children and are therefore less likely to participate in other retirement savings plans. This makes getting the most out of their payroll taxes critically important.”
Federal Reserve Chairman Alan Greenspan warns that changes to the Social Security system are imperative since the program will start running a defict by 2018. In 2001, a bipartisan presidential commission recommended changing Social Security to give workers the option of using a portion of their payroll taxes to fund retirement accounts, which could be used at retirement.
“It’s unfortunate that women’s groups like the National Organization for Women have failed to take this issue seriously,” says Lukas. “They oppose reform that gives workers the ability to invest a portion of their payroll taxes, but never make any recommendations for how they would fix Social Security’s long-term deficits.”
Without personal retirement accounts, the only alternative will be to raise payroll taxes or cut benefits. Lukas warns that neither of these options benefit anyone.
“If payroll taxes rise, women will have less money during their working years and fewer job opportunities since it will cost employers more to hire a worker,” adds Lukas. “Women deserve better. Women should push for programs that encourage savings, reward hard work and provide a secure, independent retirement. Women should demand Social Security reform that achieves these goals by incorporating personal retirement accounts.”