Women Are More Skeptical About the Future of Social Security Than Men, Study Finds
As the future of the Social Security program remains uncertain, many Americans are worried about how this will impact their retirement plans. It turns out that women are more concerned than men, though.
According to a new Northwestern Mutual study, more than 6 in 10 (63%) men in America believe Social Security will be there when they need it, while less than half (48%) of women agree. In this “Financially Savvy Female” column, we’re chatting with Alison Fyhrie, financial advisor at Northwestern Mutual, about why women are more skeptical about the future of Social Security than men.
Women Have Long Been Excluded From Financial and Wealth-Building Tools
Fyhrie believes that women’s mistrust of the Social Security program stems from a general distrust of the government and financial institutions, which have long excluded women from the programs and tools that could help them build wealth.
“For centuries, women were denied access to financial tools — credit cards, mortgages, loans, etc. — and the wealth those financial tools can create,” she said. “So personally, this new study doesn’t surprise me.”
Very few women were involved in the passing of the act that created Social Security, Fyhrie noted.
“When the Social Security Act was passed in 1935, there were only eight women out of more than 500 voting members of Congress,” she said. “Women’s voices have historically been underrepresented in rooms where powerful financial decisions are made. Are their hesitations warranted? Yes, because the fate of Social Security may feel uncontrollable to the average citizen.”
While women may not be able to control the future of Social Security, they can have a say in their financial future by creating a robust plan.
“Women benefit when they have a plan and the resources to know, no matter what happens, they can generate enough wealth to live a life of financial independence,” Fyhrie said.
Why Gen X and Millennial Women Are Particularly Skeptical About the Future of Social Security
The Northwestern Mutual study found that most boomers (63%) are very confident that Social Security will be there when they need it. Additionally, 48% of Gen Z is very confident. However, less than 40% of millennial women (39%) and Gen X women (37%) are very confident that Social Security will be there when they need it.
“Younger generations have faced a variety of financial challenges including the Great Recession of 2008, the pandemic and substantial amounts of student loan debt. Confidence in societal safety nets has waned, and negativity can spread like wildfire on social media,” Fyhrie said. “It’s enough to make many young women feel overwhelmed and want to ignore the topic of retirement entirely.”
Fyhrie said that these generations of women are not wrong to feel skeptical about the future of Social Security.
“Does Social Security have issues that need to be fixed? Absolutely. As a millennial myself, is it painful to see a deduction on your paystub and know that you may not receive your full benefit? Of course,” she said. “These generations of women are smart to be cautious in their assumptions about what social safety nets will look like decades from now.”
If you are a Gen X or millennial woman who is concerned about the future of Social Security and what that will mean for your retirement, it may be a smart idea to meet with a professional.
“The young women I work with find it comforting to voice their concerns to an advisor, rather than carry that weight and anxiety alone,” Fyhrie said. “Together we can stay engaged and co-create a plan that can account for a variety of different scenarios, one of which could be a reduced Social Security benefit. It’s always beneficial for clients to take action while they still have the benefit of time and compounding on their side.”
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