Money Culture

Oldest Women, Often Poor, Need a Hand

In this video, Elena Chavez Quezada introduces two working women in her family who didn’t get a fair shot at a comfortable retirement.

Her mother-in-law, a single mother and immigrant from the Dominican Republic, pieced together a living for herself, her parents, and her children. She never had a 401(k) or owned a house. Each time she built up a little savings, an emergency depleted it. Now in her 70s, she is supported by her son and Quezada.

Quezada’s aunt possessed the personality of a chief executive but worked as a housekeeper and sold snow cones and hot dogs at her husband’s stand in Albuquerque. After his death, she worked well into her 90s as a receptionist for a hair salon.

The goal for retired women like them should be “to age comfortably and with dignity,” said Quezada, a senior director for the San Francisco Foundation, which supports communities in the Bay area.

That’s very difficult for many older women to do. They have less wealth, and although their poverty rate has declined, women – many of them widows – still make up the vast majority of poor people over 80. This is rooted in part in their years as working women, when they earned less. Women are also the majority of single parents raising their families on a single paycheck.

A lack of a retirement plan is a common problem. More than half of the women employed full-time or part-time in the private sector are not saving in a retirement plan at any given time.

That’s quite an improvement over the 1980s – they’ve nearly closed the gap with men – but participation is still dismally low. This can happen for a variety of reasons, but many, like Quezada’s mother and aunt, either don’t have a 401(k) at their jobs or aren’t eligible to save, often because they are self-employed or work part-time.

There are ways to set them up for a more secure retirement, Quezada said, including improving pay equity with men and providing affordable childcare so they don’t lose as much time at work, which reduces their pay and future Social Security benefits. More access to state IRA initiatives like California’s Secure Choice and OregonSaves would make it easier for all workers, including women, to save.

The solution, she said, “isn’t about fixing people. It’s about fixing systems.”

Squared Away writer Kim Blanton invites you to follow us on Twitter @SquaredAwayBC. To stay current on our blog, please join our free email list. You’ll receive just one email each week – with links to the two new posts for that week – when you sign up here. This blog is supported by the Center for Retirement Research at Boston College.

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