Picture of an elderly woman

Behavior

Husbands Ignore Future Widow’s Needs

The amount of money a widow receives from Social Security can mean the difference between comfort and hardship.

Husbands have a lot of control over how this will turn out. Each additional year they postpone collecting their own Social Security adds another 7.3 percent to the amount a future widow will receive every month from the program’s survivor benefit.

But husbands can be a stubborn lot.

Previous research has shown that a large minority fail to take their wives into account when deciding to start their Social Security. A new study confirms this in an online experiment designed to raise husbands’ awareness of the financial impact their claiming age could have on a spouse. The men’s ages ranged from 45 to 62.

In the experiment, the researchers displayed Social Security’s benefit information to the men three different ways. In the first format, a control group saw the basic information: the husband’s full retirement benefit, and then a link to a second page displaying his benefits for various claiming ages. A second format also displayed his full benefit, but the link went to a page with estimates of his widow’s survivor benefits, based on the husband’s various claiming ages – the later he files, the more she would receive. The third format had the same information as the second format, but it was presented on a single web page.

Regardless of the way the survivor benefits were displayed, the men weren’t persuaded to postpone their own benefits to one day help their widows. Potential explanations include their feelings about work, existing health issues, and whether they will get a defined benefit pension from an employer.

Whatever their motivation, simply educating husbands on the financial impact of choosing a claiming age “is unlikely to improve widows’ economic outcomes,” concluded the study by the Center for Retirement Research at Boston College.

The impact of widowhood is often significant. An average widow’s total income drops 35 percent when a husband passes away, the researchers estimated from financial data for married men who had retired. The earlier the husband had started his benefits, the larger the drop in the widow’s income after the couple’s second Social Security check stops coming in.

To read the entire study, authored by Anek Belbase and Laura Quinby, see “Would Greater Awareness of Social Security Survivor Benefits Affect Claiming Decisions?”

The research reported herein was performed pursuant to a grant from the U.S. Social Security Administration (SSA) funded as part of the Retirement Research Consortium. The opinions and conclusions expressed are solely those of the author(s) and do not represent the opinions or policy of SSA or any agency of the federal government. Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of the contents of this report. Reference herein to any specific commercial product, process or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply endorsement, recommendation or favoring by the United States Government or any agency thereof.

19 Responses to Husbands Ignore Future Widow’s Needs

  1. Tom Wright says:

    Excellent information… yet disturbing that most husbands were unmoved by the potential impact their filing decision could have on the wives.

  2. Jerry says:

    Couldn’t you have more accurately framed this article by stating that couples do not anticipate a husband will likely die significantly earlier than the wife? Or, by pointing out that women statistically enjoy longer lives than men, and are therefore more often the ones who survive into the period of dwindling marital assets? Isn’t it an insultingly sexist statement to declare that “husbands can be a stubborn lot?”

    The elderly couples with whom I do retirement planning are typically very conscious of each others needs. In fact, most older men today have spent their entire economic and physical lives ensuring the needs of their spouse are taken into consideration. However, the short-sightedness usually comes in not believing that a long disability is possible or that the marriage may continue for a significant period without both partners. Both husbands and wives typically approach planning by assuming that they both will be together to very near the end because they can’t envision the one partner going on without the other. It’s a struggle to get couples to really think about that.

    I’m surprised that a semi-academic blog like this is claiming that “stubborn” husbands are the cause of an economic factor. Would it also be acceptable for someone to argue that “nagging” wives are the cause of husband’s statistically earlier death?

  3. All good points Jerry!

    Retirement planning is definitely a complex financial and emotional process, and husbands certainly have their wives’ best interest at heart. But my father loved my mother and still claimed his benefit at age 62, and 15 years later she struggles more financially because of it.

    The fact remains that 1) women live longer and 2) later claiming helps her.

    By “stubborn,” I only meant that husbands didn’t change their behavior in this experiment – and in past studies.

    Thank you for reading! Kim

  4. Jim Aulenti says:

    Um, no kidding!

    I’ve been doing kitchen table financial planning since 1981 and most men are completely oblivious to their wives future needs ~ until they are educated as to the risks and costs. Then its very simple: if he loves his wife he takes care of her. Often marriage and love are two very different experiences.

  5. Jim Aulenti says:

    The problem is very easily rectified by purchasing personal, permanent life insurance: it assures that funds will be available when needed most and directly to the beneficiary, most likely the wife. Life insurance offsets the reduction in spousal Social Security.

    Age 45 is too young for most men to seriously consider retirement, as they are in mid-career. Retirement is still way off. Plus, the divorce rate exceeds 50%, so why worry about an uncertain event almost 20 years in the future, when you’re likely going to give her >50% of your assets anyway? Divorce is a profitable enterprise.

    The men aren’t as stubborn as you think, or as stupid.

    I concur with Jerry’s statements.

    Lately I’ve conferred with people in their late 70’s and 80’s, and nobody complains about money. They’ve learned to live on what they get.

    its never enough.

  6. Janet says:

    I take exception to the words “the men weren’t persuaded to postpone their own benefits to one day help their widows.” My husband and I pool our salaries and will pool our retirement income. Maybe the men did not postpone because they and their wives needed the money sooner. Also there is a bias toward taking Social Security sooner rather than later, despite financial articles urging delay…a bird in the hand bias, I think.

  7. Mike Mas. says:

    I have ran the numbers and there are sometimes benefits to claiming early, because regardless of at what age you claim, one must factor in the longer period of payments and more upfront money you get by claiming early. Health and longevity “guesses” enter into these equations. There are what I have calculated as “break-even” points for claiming at certain ages vs. waiting for other certain ages. When I decide to claim will not be based on stubbornness, but on what I believe will be in my wife’s best long-term interests.

    • Bill says:

      Mike Mas is precisely correct about the “break even” analysis. In a nutshell, I believe Social Security continually encourages retirement benefit claiming delay because it postpones the day when Social Security will have to pay a retirement benefit to a retired worker and in the meantime the debt may be erased by his or her death. It reminds me of Wimpy’s comment, “I’d gladly pay you Tuesday for a hamburger today.”

      • Ken Pidcock says:

        The Social Security Administration strives to keep the program actuarially flat in aggregate. Everybody could claim at 62 or (plan to) claim at 70 and total benefits paid out would be the same.

  8. Ted says:

    The study asks a representative panel about their expected claiming decision based on how benefit information is presented to them. No significant difference in claiming behavior was observed between three different presentations. They then surmise that “educating” participants regarding benefit amounts is not effective in changing expected SS claiming age.

    Based on HRS data, the study points to pension incentives (meaning a company is offering a pension boost for retiring) and health concerns as chief motivators for choosing to start SS. Both motivators result in “early” retirement and without sufficient wealth, early claiming. So historically, “immediate” concerns (how do I meet our expenses?) outweigh future concerns (widow’s drop in monthly income). When a significant percentage of people can not handle a $400 one time expense, is it any wonder that people say they will take SS at the earliest possible time?

  9. David says:

    We found value in the book Get What’s Yours—Social Security.

    I sold my business and retired at 69 but waited until 70 to start SS benefits. My wife retired at 62 and waited until 66 to receive SS. (She is 4 years younger). We gave this a lot of thought and consideration before making the decision we did and waiting until 70 was not a given. We had to live on our assets exclusively during the wait. This required some careful financial analysis using certain assumptions (which could be wrong). Finally, knowing I will likely die first led us to wait to maximize her survivor benefits. We were fortunate to both have thriving careers, a long, singular, successful marriage, always pooled our resources and operate as a team and neither of us was a spendthrift. Knowledge and the willingness to act on that knowledge is crucial. We have had some good luck to have many things working in our favor. Not everyone is so fortunate. But…”luck is what happens when preparation meets opportunity” —Seneca. We spent considerable effort to be prepared for the uncertainty of what lies ahead. Time will tell if we were successful. I know that many of our friends have gone through the same deliberative process. I also agree with everything Jerry said.

  10. Such an important planning concept. Thank you for writing on this topic. As a financial advisor, I talked with clients about when to claim. Most couples hadn’t previously known their options and ramifications of those choices. Many factors to consider. When it came time to pull the trigger myself, I waited until age 70 … in part because after retirement at age 67, I began my “encore career” and continued to earn income. That plus a family history of longevity made me vote to delay Social Security payments for a bigger monthly check. Full disclosure: as a widow, I claimed a SS benefit for a few years based on my late husband’s record.

  11. Ken Pidcock says:

    In addition to enhancing security for the surviving spouse, delaying can give a couple (or, for that matter, a single worker) more confidence spending early in retirement. Say you retire at 64, then due a $20,000 annual benefit. If you delay until 70, that will be ~ $30,000. You can purchase six years’ real 30K income for less than $180,000, meaning that, between your (delayed) SS benefit and 180K retirement savings, you’ll definitely have, in addition to whatever else, $30,000 annual income from the day you retire until the day the survivor dies. Of course, you can do that without delaying, but that will require drawing down the relevant retirement savings at an initial rate of 5.5% (10/180). Many of us would not feel confident doing that. Maybe after a few years of good returns, but not initially, and so we would end up spending less early in retirement. And, once you’re retired, what you can spend is more important than what you have.

  12. Laura says:

    Take the men on a field trip to an assisted living facility or to any gathering of seniors. It will become very clear very quickly who tends to live the longest.

  13. Mike Mas. says:

    Sometimes my wife says we should be more liberal in spending down our retirement assets, and my answer is always the same…”Tell me when the last one of us is going to die and I promise to adjust our spending accordingly.” In spite of this, she still loves me.

  14. Howard Groopman says:

    This article makes certain presumptions that may not necessarily be true. One, that the husband will die first; two, that his Social Security is greater than hers. Historically, wives stayed at home and either didn’t work at all, or worked for short periods. My mother did both, and collected more on her own than she would have as strictly a wife. When my father died, she got his monthly amount, which he’d started at close to 70.

    My own wife died in 2014 at age 66. I chose to take a widower’s SS benefit, reduced for age (63), and intend to take my own in 2020 at age 70. Mathematically, it’s a win-win as long as I live till about 74 or 75, at which point I should have recouped all I gave up by not taking my own earlier.

    I took a 10% reduction in my pension because the wife would not sign off on a waiver of survivor benefit, even though I offered to buy a large, tax-free life insurance policy. 7 months later she learned she had terminal cancer that killed her after 4 years. The pension was restored, but not of course the money I lost over 4.5 years.

    Now that most wives work outside the home and will be collecting their own Social Security at retirement, not as many will be taking widow’s benefits as before, if their own check exceeds what the widow’s amount is. And if she dies first, then she’ll never collect on his account, although in certain circumstances like mine, he might well collect on hers temporarily or even permanently.

  15. Raj says:

    I think this depends on the size of your other assets. If pensions, another SS stream and substantial savings, health issues, why wait to draw SS?

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