Modernizing Social Security: Widow Benefits

Alicia Munnell and Andrew D. Eschtruth

Issues in Brief from Center for Retirement Research

Abstract: Since 1939, Social Security has provided benefits to widows to help prevent a precipitous drop in their standard of living after their spouse dies. Today, many policy experts are concerned that these benefits may be inadequate for two reasons: 1) widows remain a poor segment of the elderly population; and 2) with the increased labor force participation of women, widow benefits as a percentage of the coupleÕs combined benefits have been declining. Improving benefits for widows is an area in which some agreement has emerged. A popular approach is to increase the widow benefit and cover the cost by reducing the spousal benefit - essentially shifting money from a time when both members of the couple are alive to a time when only one member is alive. This brief on widow benefits is the third in a series on modernizing Social Security to account for changing social, economic, and demographic circumstances. The discussion proceeds as follows. The first section describes the economic status of widows. The second section explains why widow benefits have been declining relative to the coupleÕs income. The third section summarizes the standard option for improving widow benefits. The fourth section assesses this option based on three criteria: targeting efficiency, administrative feasibility, and cost offsets. The final section concludes that boosting the widow benefit, while limiting the size of the increase for higher earners, could be a well-targeted way to help reduce poverty for this vulnerable group.

Pages: 8 pages
Date: 2018-09
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