It’s no secret that women are more likely to struggle with retirement savings than men. But it’s not just the size of their nest eggs that suffer. The gender pay gap also takes its toll on women’s Social Security checks. Here’s a look at how the average female worker’s benefit stacks up to her male counterpart’s — and what you can do to close the gap.
How much do men and women get from Social Security?
Unsurprisingly, the typical Social Security benefit for men and women changes from month to month as new people sign up and older beneficiaries die. But as of May 2022, men received about $1,848 per month on average.
Women, by contrast, received just $1,494 per month. That’s a difference of about $354 per month, adding up to $4,248 per year. This really takes its toll over the long term. If a man and woman receiving the average Social Security benefit for their gender claimed checks for 20 years, the man would receive $84,960 more over his lifetime. That’s enough to cover a few years of retirement expenses for most people.
This difference occurs because Social Security benefits are based on your income during your working years. Women have consistently earned less than men for decades, which translates to a lower average benefit.
Another factor working against women is that they’re more likely than men to leave the workforce once they have children. The government considers your income during your 35 highest-earning years when calculating your Social Security benefit. Those who haven’t worked that long have zero-income years factored into their benefit calculation, and this also shrinks their checks.
What can we do about it?
This news can be discouraging, especially for women who are already worried about their financial security in retirement. But there is some good news too: The Social Security gender gap has been slowly closing over the last few decades.
In May 2000, women received less than 77% of the average man’s Social Security check. As of May 2022, they’re nearing 81%. There’s a long way to go, but if this trend continues, women’s Social Security checks may go further in the future than they do today.
There are also several things that women — or anyone — can do to boost their Social Security benefit. As mentioned above, your income today matters, so look for opportunities to increase this. Consider asking for a raise, pursuing additional education or certifications, or switching employers.
If you’re not able to work outside the home due to caretaking obligations, see if you can find a remote job or consider a side hustle that you can work on in your spare time.
Do your best to stay in the workforce for at least 35 years, longer if you can. Most people earn more money later in their careers than they did starting out. Once you surpass the 35-year mark, these more recent, higher-earning years will replace your earlier, lower-earning years in your benefit calculation, leading to higher checks.
Finally, choose your Social Security claiming age carefully. You can sign up as soon as you turn 62, but starting right away isn’t always wise. Every month you delay benefits increases your checks a little until you turn 70. If you can afford to delay Social Security and believe you’ll live into your 80s or beyond, waiting to claim could result in a larger lifetime benefit.
These strategies may not all appeal to you, but pick out a few that make sense for you and give them a try. Then, check in with yourself once per year to see if you can identify additional opportunities to increase your income and your Social Security benefit.
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