Caregiver Support Bills: Protecting Social Security Benefits for Those who Leave Work to care for parents, children, Relatives

Over the last few years there have been several bills that would expand or improve social security benefits. We believe this is important because Social Security is the most secure retirement income vehicle we have, and for the majority of retirees it is their primary or only source. Some of these bills have been broadly designed to close the Social Security funding gap while addressing inadequacies in the benefit structure while others are focused on specific issues, like the lack of credit given to family caregivers. 

These are people who take months or years out of the workforce to provide unpaid care to their parents, children or other relatives. For a variety of reasons, those workers have traditionally been women (though that trend is beginning to show signs of change). By staying out of the work force for a few years to take care of kids early in their careers or doing it (again) later in their careers, women’s social security benefits are disadvantaged in several ways. First, leaving the work force for any period of time can impact the trajectory of your career. In fact, this pattern of leaving the workforce and being the one primarily responsible for childcare is often cited as one non-discriminatory reason that women earn less than men. By working for lower wages, women earn less in Social Security benefits. 

Secondly, women dramatically reduce their Social Security benefit because of Social Security’s “high 35” system for determining benefits, because of having fewer years of paid work.  Your Social Security benefit is calculated with a formula which uses your highest 35 years of earnings. Those who take years out for child care and elder care are more likely to have $0 years factored in. Even those who have a 35 year work record may have fewer years at their career peak, and be including more of their early career, low-wage entry-level salaries compared to people in similar fields who didn’t take time out.

"As a nation we depend on family caregivers, and the least we can do is help make sure that the men and women who perform this service are protected in retirement."

So, people (primarily women) are likely to see reduced benefits—and this is a population that is already likely to live longer and have lower benefits anyway! That’s one reason to find a way to give people some Social Security credit for the years they are out of the workforce. Another reason is this: as a country we want—we need—to encourage family caregiving. As many of you know, as well as I, we do not have much of a long-term care system in this country.  Families with a relative who needs help with daily activities have limited options. Most Americans do not have long term disability insurance, and it can be very difficult to afford it.  Medicare doesn’t cover most long-term care expenses in a home or  a facility. ​

For many families, the most cost effective—or only—option is for someone to take off from work to care for their parent. According to AARP’s public policy institute, family caregivers provide nearly half of a trillion dollars in care each year. Though they are generally not paid, they are working, and they are providing a service both to their families and the country as a whole. 

Therefore, we should find a way to prevent this critically important caregiving role from diminishing the retirement security of caregivers. Americans overwhelmingly support the idea of a Social Security caregiver credit (click here to read more about it). The caregiver credit proposals in Congress (notably those from Senator Chris Murphy and Representative Nita Lowey) include giving credit for months out of the work force, based on a formula as if the person had earned a wage (generally a percent of the average wage).  There are also bills emerging this year that would do the same, but only for parental caregiving for children, which is good, but not good enough. This would certainly not replace earnings credit an average or high wage worker would have achieved back in the work force, but it can at least prevent those $0 years from slashing benefits in a “high 35” formula. 

B’nai B’rith International  is very pleased to see these bills as part of the conversation in Congress, even though 2016 might not be the most productive legislative year, given all attention being focused on elections. As a nation we depend on family caregivers, and the least we can do is help make sure that the men and women who perform this service are protected in retirement.

Photos via Flickr (1) (2)

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Rachel Goldberg, Ph.D has been the B’nai B’rith International director of health and aging policy since 2003 and the deputy director of the B’nai B’rith International Senior Services since 2007. Before joining B'nai B'rith International, she taught politics and government at the University of Puget Sound and Georgetown University. To view some of her additional content, Click Here.

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