Cost-neutral policies to increase Social Security benefits for widows: a simulation for 1992

Area of Science:

• Social Gerontology
• Public Policy
• Economics

Background:

• Older women, particularly widows, experience higher poverty rates compared to married women.
• Social Security benefits are a critical income source for older women.
• Current benefit structures may not adequately support widows after spousal death.

Purpose of the Study:

• To evaluate the impact of four cost-neutral proposals on poverty rates among older women.
• To assess the feasibility of reallocating Social Security benefits from married couples to surviving widows.
• To determine the net effect on poverty reduction for older women.

Main Methods:

• Utilized the 1991 Survey of Income and Program Participation (SIPP) data.
• Matched SIPP data with Social Security Administration (SSA) benefit records.
• Modeled the effects of four specific benefit reallocation proposals.

Main Results:

• The evaluated proposals moderately decreased overall poverty rates among older women.
• Poverty rates for widows were reduced more significantly than the slight increase observed for couples.
• One proposal, aligning with the Advisory Council on Social Security recommendations, was among those evaluated.

Conclusions:

• Reallocating Social Security benefits from couples to widows can effectively reduce poverty among older women.
• Policy adjustments can improve financial security for widows without increasing overall program costs.
• Targeted benefit shifts represent a viable strategy for poverty alleviation in later life.