In the labor structure of the United States there is still a quite large and real gender pay gap. And it exists not only during the working season for women, but also during retirement in Social Security. There are several reasons for this, and the key to understanding that it goes down to $354 on average is something really simple. When a person works less during his or her time as an active worker, he or she earns less during his or her time in Social Security. Well this applies perfectly to the role of the American woman.
Women’s wages tend to be lower, which ends up drastically lowering their retirement benefits as well. The math is really simple and we don’t need to think too hard to come to this conclusion. Overall, this is a reality that can put many women entitled to a Social Security benefit in trouble.
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Reasons why women earn less in Social Security
There are, as we have previously discussed, several reasons why women get lower Social Security, as a general rule. This is not true for all women, but it is true for most of them. These are some of the reasons:
- Lower salary during the working years: lower salary during the working years means that when you start collecting Social Security your benefit is lower. Remember that 35 years of higher salary has a direct impact on retirement. If you have a lower salary, your benefit will be lower.
- Having children: It is very common for women to leave their jobs for a period of time to raise their children. This is slowly changing in society, but it still happens. If a woman is forced to leave her job to care for her child, her average benefit will drop significantly. Each year worked adds $0 to the average Social Security benefit, so this is bad news.
How can a woman improve her benefit during retirement?
There are several ways for women to improve their retirement benefits. These tips for getting a good Social Security can be applied to everyone. In this particular case they are good for women, but they are general tips. You can always follow them to increase your benefit.
There are three basic tips to improve Social Security and eliminate some of the gender pay gap in retirement benefits:
- Work as many years as possible: even if you have to take care of your child, thinking about working part-time can be a good solution. It all depends on your personal situation, but to have a good Social Security you need to work as long as possible.
- Ask for a raise or switch to a better paying job: A high salary means a good Social Security retirement benefit in the future. If necessary, change jobs to increase your monthly salary.
- Think about your retirement age: Applying for retirement at age 62 means losing about 30% of the money you are entitled to. If you wait and apply for retirement at age 67, you will receive all the money you have contributed from Social Security.