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Women & Money: Bag Lady Syndrome

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Social Security Checks

(credit: Photo by William Thomas Cain/Getty Images)

420x316-grad-lee Dee Lee
Dee Lee is a Certified Financial Planner who received a diploma in...
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BOSTON (CBS) – This syndrome really does exist. A study done this summer by Allianz Life, their 2013 Women, Money & Power Study, states that almost 50% of women, no matter what their income levels, are having this same fear.

Several years ago I proclaimed the first week of October national Bag Lady Week. I thought we should draw attention to this matter.

This is a woman’s biggest fear, that she will be penniless and homeless as she ages and that she won’t be able to afford medical care.

The average woman aged 65 lives six years longer than the average man. As a result, she is typically widowed and living alone.

She struggles to make ends meet on an average annual income of about $16,000 compared with over $29,000 for men. According to the Census Bureau, nearly one-in-five women who are living alone live in poverty.

During her lifetime the average woman will spend 17 years raising her children and 18 years caring for elderly parents and possibly her spouse. Her retirement income is also smaller because she probably did not receive a pension and was paid less over her lifetime than the average man. Less than 1/3 of women will receive a pension as compared to 55% of men. Women are more likely to work part-time so often they are not eligible for a pension.

Most women receive lower Social Security benefits. They are the face of Social Security, comprising almost 60% of beneficiaries over age 62 and 70% of recipients over age 85.

For one third of the unmarried elderly women Social Security is their sole source of retirement income. The average monthly Social Security check for a woman is $1,023. That’s $300 a month less than that of the average man and over 20 years that’s $72,000.

The numbers only get scarier! Seven out of ten “baby boomer” women are expected to outlive their husbands/partners. Many will be widows for 15 to 20 years.

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