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76–246 PDF 2012

S. HRG. 112–591 

ENHANCING WOMEN’S RETIREMENT SECURITY 

HEARING 

BEFORE THE

SPECIAL COMMITTEE ON AGING 

UNITED STATES SENATE 

ONE HUNDRED TWELFTH CONGRESS 

SECOND SESSION 

WASHINGTON, DC 

JULY 25, 2012 

Serial No. 112–21 

Printed for the use of the Special Committee on Aging 

( 

Available via the World Wide Web: http://www.fdsys.gov 
(II) 

SPECIAL COMMITTEE ON AGING 

HERB KOHL, Wisconsin, Chairman 

RON WYDEN, Oregon 

BILL NELSON, Florida 

BOB CASEY, Pennsylvania 

CLAIRE MCCASKILL, Missouri 

SHELDON WHITEHOUSE, Rhode Island 

MARK UDALL, Colorado 

MICHAEL BENNET, Colorado 

KIRSTEN GILLIBRAND, New York 

JOE MANCHIN III, West Virginia 

RICHARD BLUMENTHAL, Connecticut 

BOB CORKER, Tennessee 

SUSAN COLLINS, Maine 

ORRIN HATCH, Utah 

MARK KIRK III, Illinois 

DEAN HELLER, Nevada 

JERRY MORAN, Kansas 

RONALD H. JOHNSON, Wisconsin 

RICHARD SHELBY, Alabama 

LINDSEY GRAHAM, South Carolina 

SAXBY CHAMBLISS, Georgia 

CHAD METZLER, Majority Staff Director 

MICHAEL BASSETT, Ranking Member Staff Director 
(III) 

CONTENTS 

Page 

Opening Statement of Senator Herb Kohl ............................................................. 1 

Statement of Senator Bob Corker .......................................................................... 2 

PANEL OF WITNESSES 

Barbara D. Bovbjerg, Managing Director, Education, Workforce, and Income 

Security Issues, Government Accountability Office, Washington, DC ............ 3 

LaTina Burse Greene, Assistant Deputy Commissioner for Retirement and 

Disability Policy, Social Security Administration, Baltimore, MD .................. 5 

Kelly O’Donnell, Vice President, Financial Engines, Boston, MA ....................... 6 

Sabrina L. Schaeffer, Executive Director, Independent Women’s Forum, 

Washington, DC ................................................................................................... 8 

Joan Entmacher, Vice President and Director, Family Economic Survey, National Women’s Law Center, Washington, DC .................................................. 10 

APPENDIX 

WITNESS STATEMENTS FOR THE RECORD

Barbara Bovbjerg, Managing Director, Education, Workforce, and Income Security Issues, U.S. Government Accountability Office, Washington, DC ........ 24 

LaTina Burse Greene, Assistant Deputy Commissioner, Retirement and Disability Policy, Social Security Administration, Baltimore, MD ........................ 36 

Kelly O’Donnell, Vice President, Financial Engines, Boston, MA ....................... 45 

Sabrina Schaeffer, Executive Director, Independent Women’s Forum, Washington, DC ............................................................................................................. 50 

Joan Entmacher, Vice President and Director, Family Economic Security, 

National Women’s Law Center, Washington, DC ............................................. 55 

ADDITIONAL INFORMATION BY WITNESSES FOR THE RECORD

‘‘Retirement Security: Women Still Face Challenges,’’ U.S. Government Accountability Office ................................................................................................ 66 

‘‘Trends in Early Benefit Claiming,’’ Social Security Administration ................. 162 

Letter regarding long-term care employment, National Women’s Law Center .. 166 

ADDITIONAL STATEMENTS SUBMITTED FOR THE RECORD

American Council of Life Insurers, Washington, DC ........................................... 167 

Employee Benefit Research Institute, Washington, DC ....................................... 174 

Human Rights Campaign, New York, NY ............................................................. 184 

(1) 

ENHANCING WOMEN’S RETIREMENT 

SECURITY 

WEDNESDAY, JULY 25, 2012 

U.S. SENATE, 

SPECIAL COMMITTEE ON AGING, 

Washington, DC. 

The Committee met, pursuant to notice, at 2:04 p.m., in Room 

SD–562, Dirksen Senate Office Building, Hon. Herb Kohl, chairman of the committee, presiding. 

Present: Senators Kohl [presiding], Blumenthal, and Corker. 

OPENING STATEMENT OF SENATOR HERB KOHL, CHAIRMAN 

The CHAIRMAN. Good afternoon, everybody. We’d like to thank 

our witnesses and welcome all the rest of you to today’s hearing. 

Today we are here to examine the challenges women face in working to achieve retirement security. In 2010, women over 65 were 

nearly twice as likely to live in poverty as men. Reasons for this 

are many. On average, women live longer than men, they make 

less money than men, and they are more likely to move in and out 

of the workforce to care for family members, which reduces their 

opportunities to contribute to a pension plan or Social Security. 

This committee asked the Government Accountability Office and 

other interested parties to explore this problem and recommend 

ways to reduce the risk many women have of outliving their savings and falling into poverty. The most popular answer involved 

improving Social Security benefits, which women disproportionately depend on for their retirement income. This means that as 

Congress addresses Social Security’s pending insolvency, we must 

also work to modernize the program to ensure it remains a safety 

net for those most in need. 

The GAO report explores many of these options and we’ll hear 

from several witnesses about possible changes. One bipartisan solution that should be included in any reform package is to enhance 

the special minimum benefit. This can be done at a reasonable cost 

and it would help ensure that career low wage earners who have 

little opportunity to save on their own can avoid being stuck in 

poverty throughout their retirements. 

But what about women who are close to retirement now? For 

them, the GAO report recommends one decision that many perhaps 

do not even consider, namely waiting to claim these retirement 

benefits. Deciding when to take Social Security benefits is one of 

the most important financial decisions a person can or will make 

in retirement. 
2 

Currently the majority of women claim benefits at 62, the earliest age possible. Only 18 percent wait until their normal retirement age of 66 or later. This option is not for everyone. Some have 

health concerns and others may be unemployed or have very little 

money that they’ve saved. However, if you can delay and you don’t, 

you will be leaving a lot of money on the table. A woman who 

might be expected to get $1,000 a month at 66 gives up $250 every 

month for the rest of her life if she files to take the benefits, not 

at 66, but at 62. 

On the other hand, if she waits until she’s 70, then she’ll be looking at a monthly benefit of $1320. That would be an additional 

$570 for the rest of her life if she delays her benefit from 62 to 70. 

A recent study from the Center for Retirement Research called this 

strategy to delay benefits ‘‘the best deal in town.’’ 

SSA has a responsibility to educate people about their options 

and it needs to make sure people understand just how much money 

they are losing when they take their benefits sooner rather than 

later. We’ll be asking SSA today about its approach and its overall 

efforts to educate the public about their options. 

We thank you all again for being here. We’d like to give a special 

thank-you to the various aging and women’s organizations that 

have been sharing their insights with our committee on ways to 

improve women’s retirement security. 

We turn now to the ranking member, Senator Corker, for his remarks. 

STATEMENT OF SENATOR BOB CORKER 

Senator CORKER. Thank you, Mr. Chairman, for calling this hearing, and to all of you as witnesses for being here. 

I do think it’s a very, very important issue. As I travel around 

the country and my own State, I worry about people being prepared for retirement, especially women, who in many cases, for lots 

of reasons, haven’t focused as much on it as should be the case. 

I think we’re going to have an opportunity, Mr. Chairman, to 

deal with this special minimum benefit, I really do, and I think 

there is bipartisan support for something like that, and I appreciate your bringing it up. I hope as part of any package, budget 

package or fiscal reform package that we deal with over the course 

of the next six months, year and a half—I hope it’s on the front 

end of that—I do think that Social Security reform should be a part 

of that and hopefully will be a part of that. And my sense is the 

special minimum benefit that you’re talking about very much 

should be a part of that also. So I appreciate your bringing that 

up. 

One of the most responsible things that we could do here is actually do those things to make Social Security solvent for the long 

haul. But I think making people aware of the options that exist 

and certainly the ones you pointed out about deferral until a later 

age, but also hopefully causing people throughout our society, in 

this case especially women, to focus on the standard of living that 

one’s going to have without focusing on this, and hopefully moving 

people towards this particular issue. 

So I thank you very much. I’ve got—we’ve got a little LIBOR 

issue that’s cropped up over the last couple weeks and I’ve got a 
3 

conflict with one of my other committee responsibilities and I will 

not be here for the entire hearing, but our committee staff is here. 

We thank you for being here. We certainly have read your testimony or will read portions that we haven’t seen yet. Again, thank 

you. 

The CHAIRMAN. Thank you. Thank you, Senator Corker. 

Introducing our witnesses, the first witness today will be Barbara Bovbjerg, Managing Director of Education, Workforce, and Income Security Issues at the U.S. Government Accountability Office. 

Next we’ll be hearing from LaTina Burse Green, Assistant Deputy Commissioner in the Social Security Administration Office of 

Retirement and Disability Policy. 

Then we’ll be hearing from Kelly O’Donnell, Vice President of Financial Engines, the Nation’s largest registered investment adviser, helping more than 600,000 workers manage their 401(k) accounts. 

Next we’ll be hearing from Sabrina Schaeffer, Executive Director 

at the Independent Women’s Forum, a nonprofit aimed at promoting limited government and free markets. 

Finally, we’ll be hearing from Joan Entmacher, Vice President 

for Family Economic Security at the National Women’s Law Center. She directs the nonprofit’s program to improve policies affecting the economic security of low income women. 

Thank you all for being here. Barbara, we’ll start with you. 

STATEMENT OF BARBARA D. BOVBJERG, MANAGING DIRECTOR, EDUCATION, WORKFORCE, AND INCOME SECURITY 

ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE, WASHINGTON, DC 

Ms. BOVBJERG. Thank you, Mr. Chairman, Senator Corker. I’m 

pleased to be here today to discuss the challenges women face in 

attaining a secure retirement. I’m especially pleased to be here in 

advance of your own retirement, Mr. Chairman, later this year so 

that I can thank you for your leadership on issues affecting older 

Americans. This committee has achieved a great deal under your 

leadership—— 

The CHAIRMAN. Thank you. 

Ms. BOVBJERG [continuing]. And we’ll miss you. 

The CHAIRMAN. Thank you. 

Ms. BOVBJERG. My testimony today will present the results of 

our work for this committee on women’s retirement security. Our 

analysis examines four aspects of the topic: women’s access to and 

participation in employer-sponsored pensions; the retirement income women receive and its sources; how later in life events may 

affect women’s retirement; and the policy options available to help. 

Our report, which is being released today, uses a variety of Federal 

data sources and models that we developed. 

First, women’s access to pensions. Over the last decade, working 

women’s access to and participation in employer-sponsored pension 

plans improved. In fact, women even surpassed men in their likelihood of working for an employer who offers such benefits, although 

this results in part from a simultaneous decline in men’s pension 

coverage. 
4 

Despite women’s greater likelihood of having access to a pension, 

they were slightly less likely than men to participate in such plans, 

although the gap between men’s and women’s participation has 

narrowed. Differences in men’s and women’s earnings are thought 

to play a significant role in these continuing participation disparities. 

As for women’s retirement income levels and composition, in the 

last ten years women age 65 and over consistently had less retirement income and higher poverty rates than men. Groups of the 

lowest median incomes and highest poverty rates included single 

women, women over the age of 80, and non-white women. Still, the 

composition of women’s retirement income has been fairly stable, 

largely because women are likely to receive income from Social Security and from defined benefit pension plans, and these have been 

shielded from market fluctuations. Although stability is a good 

thing, in the end women still have significant fewer resources later 

in life than men. 

So let me now turn to late in life events and their differential 

effects on men and women. Divorce, the death of a spouse, health 

decline, and unemployment all had detrimental effects on wealth 

and income for both men and women nearing or in retirement. Divorce and widowhood, however, have more pronounced effects on 

women. Our analysis shows that after divorce or separation, women’s household income fell by 41 percent on average, almost twice 

the 23 percent decline for men in the same situation. Widowhood 

has a similar disparity, with women’s income falling by 37 percent 

and men’s by 22 percent. 

What options are available to address these disparities? Well, experts we interviewed identified 22 policy options that could address 

some of the challenges older women face. Generally, these included 

tax incentives to save, improved Social Security benefits, strengthened spousal protections, and encouragement to save longer and retire later, among other strategies. 

But these options bring difficult choices. For one, all have cost 

implications that would need to be considered, and many of those 

costs would fall on the Federal Government, although some are 

also spread across workers and their employers. Although all the 

options would aid women in retirement, many would aid men as 

well by focusing on income security more than on gender, which is 

not a bad thing. 

Retirement security continues to be a national dilemma that by 

and large transcends gender. Recent economic volatility, coupled 

with the continued shift toward defined contribution plans, exposes 

all workers to more financial risk than in previous generations. 

And women’s gains relative to men were aided in part by men’s 

loss of retirement security over the last several years. So clearly 

this is a problem for all Americans. 

But our work highlights that women face a unique set of circumstances that warrant special attention. In particular, divorce or 

widowhood occurring late in life can be disproportionately devastating to women’s retirement security. Efforts to improve retirement prospects for women will almost necessarily need to focus on 

a response to such events. Our work offers various options that 
5 

could help address this problem, a problem that will become increasingly urgent in our aging society. 

That concludes my testimony. I’d be happy to answer any questions you have. 

The CHAIRMAN. Thank you very much. 

LaTina Burse Greene. 

STATEMENT OF LATINA BURSE GREENE, ASSISTANT DEPUTY 

COMMISSIONER FOR RETIREMENT AND DISABILITY POLICY, 

SOCIAL SECURITY ADMINISTRATION, BALTIMORE, MD 

Ms. BURSE GREENE. Chairman Kohl, Ranking Member Corker, 

and members of the committee: I appreciate this opportunity to 

speak to you about the importance of the Social Security retirement 

decision and how it affects women. We take our responsibility to 

provide complete, relevant, and understandable information about 

benefit options very seriously. Our role is to help ensure that the 

American people have the information they need to make informed 

decisions about retirement. 

Social Security is particularly important to women for several 

reasons, as you’ve already mentioned. First, women tend to live 

longer than men. Second, they generally have lower lifetime earnings. And third, women often retire with smaller income from other 

retirement programs and personal savings. 

Although individuals with identical earning histories receive the 

same benefits, some elements of our program are specifically helpful for women. For example, the Social Security benefit formula 

helps women because it is structured to more fully replace the 

earnings of lower wage earners. Women’s greater life expectancy 

makes the automatic cost of living adjustment especially important. 

Our program also provides benefits for family members of retired, disabled, and deceased workers. Thus, in addition to benefits 

as a retired or disabled worker, women may receive higher benefits 

as a spouse, divorced spouse, or widow due to their lower lifetime 

earnings. 

Choosing when to retire will determine the amount of Social Security benefits a person will receive for the rest of his or her life 

and also can affect the benefits paid to his or her spouse. Our policy is to provide complete and accurate information—not advice— 

to assist claimants with making a personal decision on when to retire without influencing them in any particular direction. Regardless of how a person chooses to file for retirement, be it face to face, 

telephone, or Internet, we offer the same pertinent information. We 

provide information about the monthly benefit amounts payable at 

various ages, such as the earliest possible month of entitlement, at 

age 62, at full-retirement age, at age 70, or any other age the person requests. We inform them how earnings can affect their benefits. We also explain other benefits that may be available, such as 

benefits that could be payable to a spouse or to a child. 

When people ask us, what is the best age to start receiving retirement benefits, we tell them there is no ‘‘single best age’’ and 

that ultimately it is their choice. It is a personal decision that 

should be based on a number of factors, such as their cash needs, 

their health and family longevity, whether they plan to earn employment income in retirement, whether they have other retire-
6 

ment income, whether others are financially dependent on them, 

and of course the amounts of their future Social Security benefits. 

We are proud of the online tools we have developed to help people navigate the complexities of their retirement decision. The Social Security Statement, available online since May 1st, provides 

projections and estimates of retirement, disability, and family and 

survivor benefits. Our retirement estimator is a calculator that provides immediate and personalized retirement benefit estimates. 

Our life expectancy calculator is another simple but important tool 

to assist the public with retirement planning. 

We also make available a number of print resources aimed at 

helping women with their Social Security decisions, including a fact 

sheet entitled ‘‘Social Security Is Important to Women.’’ Publications such as ‘‘What Every Woman Should Know’’ and ‘‘Understanding the Benefits’’ are also available. These publications are 

available through our 800 number, in our field offices, and can also 

be downloaded from our web page at www.socialsecurity.gov/ 

women. 

Our financial literacy, retirement security, and education initiatives to encourage saving are useful to women who are planning for 

retirement now. We participate in pre-retirement seminars and 

other forms to provide information targeted towards women. For 

example, this coming Saturday we will be participating in a public 

program in Chicago hosted by the Department of Labor that will 

include panel discussions on how women can better manage and 

protect retirement savings and what to look for in the retirement 

marketplace. We will continue to help the public make well-informed retirement decisions. 

In closing, Chairman Kohl, we are especially grateful for your 

leadership and your many years of support of our program. Thank 

you again for inviting me to testify today and I look forward to answering any questions you may have. 

The CHAIRMAN. Thank you very much. 

Kelly O’Donnell. 

STATEMENT OF KELLY O’DONNELL, VICE PRESIDENT, 

FINANCIAL ENGINES, BOSTON, MA 

Ms. O’DONNELL. Good afternoon. I’d like to thank the Senate 

Special Committee on Aging for this opportunity to provide testimony. My name is Kelly O’Donnell and I am a Vice President at 

Financial Engines. Co-founded in 1996 by Nobel Laureate Bill 

Sharpe, Financial Engines works with America’s leading employers 

and retirement plan providers to make retirement help available to 

over 8 million 401(k) plan participants. We are not a fund manager, nor do we offer any investment products. We are an independent provider of investment advice and discretionary asset 

management services. 

The median 401(k) account balance we serve is $41,000. Our 

newest offering, Income+, helps retirees turn their 401(k) account 

into flexible but steady payouts that can last for life. 

Women and retirement security is a very personal topic for me. 

My father unexpectedly passed away last November and helping 

my mother plan for steady income for the rest of her life has been 
7 

complex and challenging, even for a financial professional like myself. 

In my testimony today, I will focus on three key points: First, 

helping individuals, especially women, maximize their income in 

retirement is imperative. For most individuals, it is hard enough 

to save and invest in the years before retirement. It is even more 

difficult to know how to draw down the assets so you don’t run out 

of money in retirement. Employers are slowly beginning to offer retirement income solutions within 401(k) plans to help. The range 

of 401(k) income solutions available today includes annuities as 

well as managed account services, such as Income+. Exhibit 1 provides an overview of these solutions and their utilization. 

We developed Income+ to help all individuals, but the biggest 

need is among women. Not only are life expectancies longer for 

women, but women typically have accumulated much less when 

they reach retirement age. Among our clients age 60 or older, the 

median 401(k) account balance for men is $82,000, yet only $46,000 

for women. Clearly, more needs to be done to help women. Income 

solutions that merely annuitize retirement accounts will not be sufficient. 

My second point is that for women the financial impact from optimal Social Security decisions can exceed 401(k) savings. Women 

uniquely benefit from good Social Security decisions since life expectancy for women is greater than for men. When claiming is 

maximized, it can significantly increase the amount of income a 

woman will have in retirement. For married women, optimal 

household Social Security strategies result in a much higher benefit for the surviving spouse, in some cases 76 percent higher. Since 

the surviving spouse is more likely to be a woman, maximizing Social Security plays a major role in creating income security for 

women. Based on our analyses, optimal Social Security decisions 

can in many cases create more retirement income wealth than a 

woman has accumulated in her 401(k) account. 

My last point is deferring Social Security is often the best way 

to make a big impact with a small 401(k). However, for women to 

realize these benefits they need more help. Employer involvement 

is critical. The challenges in getting individuals to defer Social Security are formidable. There are awareness and behavioral challenges, and figuring out an optimal strategy is complicated and 

personal. 

However, deferral challenges can be overcome if there is help 

with how to use a 401(k) or IRA as an income bridge. For many, 

this may be the best use of a small retirement account. I have been 

involved personally in testing with employers and participants the 

application of Income+ so that 401(k) payouts are higher in the 

early years of retirement, thereby allowing Social Security deferral. 

We are very encouraged at the reaction we are getting from both 

groups. 

Employers are crucial to bringing this type of help to the broadest number of people. Aside from Social Security, 401(k) plans represent the largest source of potential retirement income for millions 

of American workers. The scale economics of 401(k) plans make it 

not only possible to bring institutionally priced products and advice 
8 

to participants, but also sponsors’ fiduciary oversight to help ensure participant interests are protected. 

In conclusion, we urge more to be done to encourage employers 

to provide retirement income help, including help with Social Security strategies, for their employees. Every day tens of thousands retire. More than half are women. Most over 62 will start taking Social Security within two months of leaving the workforce, a decision 

that is irrevocable. Women stand the most to gain by better Social 

Security decisions and more help with maximizing their retirement 

accounts. 

I would like to once again thank the committee for this opportunity to provide testimony. 

The CHAIRMAN. Thank you very much. 

Sabrina Schaeffer. 

STATEMENT OF SABRINA L. SCHAEFFER, EXECUTIVE DIRECTOR, INDEPENDENT WOMEN’S FORUM, WASHINGTON, DC 

Ms. SCHAEFFER. Thank you, Chairman Kohl and Senator Corker. 

I appreciate you reaching out to the Independent Women’s Forum 

and inviting me today to appear before you to testify on an issue 

that is so important to the country and so critical to both men and 

women. I’m Sabrina Schaeffer, the Executive Director of the Independent Women’s Forum, the only women’s think tank focused entirely on economic liberty. Our mission is to expand the number of 

women who understand and value the benefits of limited government, free markets, and personal responsibility. 

My interest in Social Security stems from research I conducted 

in graduate school at the University of Virginia and has continued 

throughout the last 12 years I’ve been here in Washington. 

I think we all agree that we need to make certain that any new 

system that is put in place preserves Social Security’s promise and 

protects the most vulnerable members of society, many of whom 

are women. Clearly that means protecting the benefits of current 

seniors and those approaching retirement. It also means protecting 

the benefits of low income workers so that Social Security fulfills 

its promise of keeping seniors out of poverty. 

But we need to think seriously not only about how the system 

will affect those of us working today, but also how it will impact 

the workers of tomorrow. Today I want to discuss some of the problems with the current system, specifically the challenges it poses 

for women. 

Women are a particularly disadvantaged group as a result of the 

program’s antiquated defined benefit system. The fact is Social Security’s benefits structure has remained largely unchanged since it 

was established in 1935, but the same, of course, cannot be said for 

women’s role in society. Social Security’s benefit formula is a relic 

of an era when many more Americans were part of a traditional 

single-earner family in which the husband was the breadwinner 

and women worked solely within the home. Today, however, a minority of Americans lives in this family structure. Most women, 

married and unmarried, work outside the home. Many women are 

putting off marriage and childbearing until much later in life. Others never marry and divorce, unfortunately, is far more common. 
9 

At its core, the current benefit structure remains highly regressive. As a result, many women lose out under Social Security’s calculations. Consider, for instance, the problem of the outdated dualentitlement rule. The architects of Social Security designed the program so that at the time of retirement the spouse with the lower 

lifetime earnings, usually the wife, would receive either a benefit 

equal to her own earnings or half of her spouse’s benefits. At a 

time when far fewer women worked outside of the home, this may 

have made sense, but today this means that the stay-at-home 

spouses who are not contributing financially to Social Security are 

benefiting at the expense of women working outside of the home, 

who continue to be required to pay Social Security taxes but don’t 

necessarily receive any additional benefits. 

In 1935 divorce was far less common than it is today. Still, the 

structure of the program has not kept pace. Divorced women then 

and now must have been married for ten years in order to receive 

Social Security benefits based on their former husband’s earnings. 

Again, this may have seemed generous in the 1930s, but today millions of women who find themselves in bad marriages are penalized 

by this policy. 

Social Security also fails many single women. A single mom, for 

example, who has paid Social Security taxes her whole life will 

leave her adult children only Social Security’s paltry $255 death 

benefit. So her years of work and thousands put into the system 

will have been for nothing. 

Single working women and men without children who die prematurely receive the harshest punishment of all: The state reclaims all of their contributions to Social Security without the option to leave savings to other relatives, friends, or charity. 

So at a time when women outperform men academically, are 

soaring to the top of nearly every professional arena, and are increasingly becoming the breadwinners, we need to recognize that 

the antiquated view of Social Security is not the best we can do for 

women, and the fact is gender imbalance is a serious liability of the 

current system. 

Where IWF differs from many other women’s organizations is 

that the solution for women is not more wealth distribution. Rather, women need a retirement plan that reflects the changing roles 

of women and the American family in the 21st century. There are 

several different options for helping to make the current system 

sustainable, but making the current Social Security system sustainable shouldn’t be the only goal of reform. Ultimately, policymakers must consider how to move toward a system that allows 

people, both men and women, to save and invest on their own and 

gives them the greatest flexibility. 

It’s wonderful to hear what’s happening in the private sector to 

help individuals save for retirement. When it comes to the Social 

Security system, I think individual retirement accounts are still 

one more way that we may consider how men and women can own 

and control their savings, bringing much higher rates of return 

that they can pass on to family or to charity. 

In the end, it’s important to remember that women want what 

we all want today, the freedom to save and invest in a way that 
10 

reflects the needs of their individual family and plans for the future. 

The CHAIRMAN. Thank you very much. 

Joan Entmacher. 

STATEMENT OF JOAN ENTMACHER, VICE PRESIDENT AND DIRECTOR, FAMILY ECONOMIC SURVEY, NATIONAL WOMEN’S 

LAW CENTER, WASHINGTON, DC 

Ms. ENTMACHER. Chairman Kohl, thank you for inviting me to 

testify on behalf of the National Women’s Law Center and for your 

leadership throughout the years on issues affecting older women. 

It’s a pleasure to have the opportunity to talk about ways to make 

Social Security, the foundation of women’s retirement security, 

even better. 

But before I talk about possible enhancements, I would say: 

First, do no harm. It’s disturbing that Social Security is on the 

table in deficit reduction talks and that cuts have been proposed 

to benefits that average just $12,100 a year for women 65 and 

older. The Bowles-Simpson plan, for example, includes three painful cuts to Social Security. It would reduce the annual cost of living 

adjustment by switching to the chained CPI. A COLA cut gets 

deeper every year, so it hits women, who generally live longer, 

harder. It would raise the retirement age to 69 and every year 

added to the retirement age represents a 7 percent across-theboard benefit cut. Third, it would change the benefit formula. The 

formula cuts would be deepest for middle and upper income workers, so they’ve sometimes been called progressive, but in fact they 

would affect workers with average earnings as low as $10,000 a 

year. 

Now for improvements. I’ll be outlining four proposals to enhance 

Social Security. I’ll also talk about reforms to Supplemental Security Income, SSI, our existing safety net program for poor elders 

that is in desperate need of modernization. 

One important Social Security reform is to improve the special 

minimum benefit. I was delighted to hear the bipartisan interest 

in that benefit improvement. I would simply point to my written 

testimony, which identifies specific ways of doing that, but add this 

caution, that if that improvement is simply a way to mitigate cuts 

such as those that are in some plans like the Bowles-Simpson plan, 

it might end up mitigating the harm, but not really making people 

better off, which should be the goal of enhancing this benefit. 

Second, provide credit for caregiving. As you’ve mentioned, as 

have other witnesses, women are still more likely to take time out 

of the labor force for caregiving. Social Security doesn’t directly 

credit those years. It recognizes it only indirectly through the benefits for wives and widows, and that’s an imperfect way of doing it. 

So one proposal would give workers up to five years of credit for 

caregiving, computed at 50 percent of the average wage. 

Third, create an alternative benefit for widows and widowers. 

Make it equal to 75 percent of the couple’s combined worker benefits, instead of simply the higher benefit of either. This would improve both the adequacy of benefits for a surviving spouse and the 

equity of benefits between single-earner and dual-earner couples. It 
11 

could be capped to target the proposal to low and moderate income 

earners and reduce the cost. 

Fourth, use the Consumer Price Index for the Elderly to determine the COLA for Social Security and SSI. The CPI–E is a more 

accurate measure of inflation for the elderly because it takes account of their spending patterns, which are twice as high on health 

care costs, where inflation is much higher than for costs generally. 

Because of the focus of this hearing, I’ve highlighted improvements to Social Security retirement benefits that are especially important for women. But a complete reform package should consider 

other issues, such as improving benefits for people with disabilities, 

restoring and improving the student benefit, ending discrimination 

against same-sex couples, and increasing benefits broadly to improve retirement security for many Americans who have increased—are at increased risk. 

Finally, turning to SSI, this means-tested program provides basic 

income support to the elderly poor and children and adults with 

disabilities. Two-thirds of all SSI beneficiaries 65 and older are 

women. Congress needs to consider SSI when it thinks about retirement security for women to ensure that the poorest beneficiaries, who get benefits from both programs, actually are made 

better off by improvements to Social Security benefits and are not 

made worse off because they lose Medicaid eligibility. 

More generally, SSI urgently needs to be updated. For example, it includes a $20 a month disregard for Social Security benefits. 

This means that for every dollar in Social Security benefits above 

$20 a month, they lose a dollar in SSI benefits. This $20 disregard 

has not been changed in the 40 years since SSI was created. People 

are ineligible for SSI if they have more than $2,000 in assets for 

an individual or $3,000 for a couple. This limit is nearly 30 years 

old. 

Since Social Security was created 75 years ago, it’s been improved several times by Congress to make it better for women. I’m 

glad this committee is considering continuing that proud tradition, 

and thank you again for this opportunity to testify. 

The CHAIRMAN. Thank you very much. 

Ms. ENTMACHER. Thank you. 

The CHAIRMAN. We’ll start with you, Ms. Bovbjerg. You recommend in your report that SSA educate people about the advantages of waiting to file for benefits. But are there people for whom 

waiting is a bad idea? What is the benefit for the rest of the population? 

Ms. BOVBJERG. We’ve reported in earlier work that we’ve done 

that many, many people would benefit from waiting, from delaying 

claiming for Social Security benefits, particularly in the context 

that we’re speaking about today. Single women would benefit tremendously. We don’t think they always know that this is something they should do. 

If people are in ill health, which does affect a significant percentage of people over 65, they might want to claim early because they 

think that they won’t live long enough to benefit from the increased 

benefit earned by waiting until age 70. People who are low earner 

spouses might not benefit as much. But nearly everyone else does 

and should at least consider it. 
12 

A concern that we have had for quite some time is that the government does not speak with one voice on the advantages of working longer and claiming later, and we’ve spoken about this frequently before this committee. We’ve made recommendations that 

the government should think more generally about the signals that 

we send. For example, we have different claiming and eligibility 

ages for different programs—Medicare, Social Security, pension 

withdrawal requirements. But if you really look at Social Security, 

which has the biggest platform in some ways, Social Security does 

have an opportunity to get the word out to people, make the information more readily available. We think that if we frame the issue 

perhaps a little differently so that it’s more focused on age 70 and 

less on the so-called full retirement age, that that could make a difference. 

I think it would also be important that Social Security consider 

what do they want to say, how are they going to say it, and how 

can it be said consistently across field offices, 800 number operators, and the web site, where people are increasingly claiming electronically. We think these things would go a long way. 

If I could, just while I have the floor for a minute, I just would 

like to talk about the importance of the opportunity of the Social 

Security statement, which is a way that we once reached every 

American over the age of 25. And now we are only sending to people over age 60 and people when they turn 25, on or around their 

birthday. Others can obtain it on line, but many people won’t do 

that. That is an opportunity to educate people. 

We have called in the past for a redesign of the statement to 

make it more accessible to people and to really explain some of 

these things more clearly; we also believe that it should be more 

widely available, and we’re saddened that it’s not. We think it’s an 

opportunity that’s being lost. 

The CHAIRMAN. Thank you so much. 

LaTina Greene, we’ve heard from GAO and many people are asking the question, and I’m sure you can provide some cogent observations, why doesn’t SSA do more to educate people about the consequences of delaying benefits? You state and we recognize that 

you don’t want to be people’s financial advisers. But for many people, especially those who depend largely on Social Security, SSA is 

where they get the information. Don’t you feel that you, we, the 

country, owes it to these people to at least be certain that they are 

fully familiar with the ramifications of beginning the benefits at 62 

or 66 or 70? 

Ms. BURSE GREENE. Absolutely we agree, absolutely. I don’t 

think that there is a disagreement there. Our position is that, regardless of the service channel that a claimant chooses to file for 

retirement benefits, we provide the same information to them. We 

provide them information as to their monthly benefit amounts at 

age 70, at the full retirement age, at age 62, at their earliest month 

of entitlement, or at any other month they choose. 

We make them aware of the fact that if they decide to claim 

early, they will have a reduction of between 25 and 30 percent of 

the benefit that they would be entitled to at full-retirement age. 

We explain to them that if, in fact, they delay retirement after the 

full retirement age, that they will receive an 8 percent increase in 
13 

their monthly benefit amount each year thereafter. We explain to 

them exactly how earnings will affect their benefits and how their 

personal decision will affect their spouses and their surviving 

spouses and so forth. 

So I think that, regardless of the service channel, we provide all 

of that relevant information. We have publications available online. 

We have various calculators and tools available online for them to 

be able to make informed decisions, might I add very personal decisions, about when it’s best to retire. 

But I think from my opinion we’ve been here before. In 2008 we 

were influencing individuals, admittedly, to retire at age 62. We’ve 

recognized the error of our ways. We’ve adopted a more neutral position by providing them with the facts, complete, objective, neutral 

facts, so that they can make sound, informed decisions. And I think 

we’re going backwards if in fact, instead of influencing them to retire early, now we’re going to be influencing them to retire later. 

I think our position is the right position to take and that is to just 

provide the facts and rely on the experts, like the financial advisers 

and professionals, to basically delve into their financial portfolios, 

to ask them questions about their health and family longevity, to 

ask them questions about their other streams of income. 

Our technicians are not financial advisers, as you mentioned and 

to be quite honest with you, the time that we spend delving into 

their financial portfolios could be spent working on other missioncritical work that we have to do. 

The CHAIRMAN. All right. Well, we’ll come back to that. I think 

it’s a crucial point, at least for our discussion. 

Kelly O’Donnell, what kind of knowledge do consumers have 

about Social Security and when they come to you do they know 

about the advantages of delaying benefits? 

Ms. O’DONNELL. Based on our work with employers and 401(k) 

participants, I would say generally they’re not aware. One of the 

things we have found with the roll-out of our retirement income 

service Income+, which is based on the 401(k), it immediately started bringing up more questions about the retirement income puzzle, 

so things like Social Security, Medicare, DB pensions, how all those 

things fit together. 

Social Security has generally been a surprise in terms of the benefit that can be obtained for both employers and participants, a 

pleasant surprise, but a surprise. 

To Ms. Green’s remarks, I do believe that what we find is that— 

and this has been typical of what we’ve seen in the 401(k)—is that 

education can provide a baseline of knowledge. We’ve seen that informing people and educating people about how to save and invest 

in their 401(k) has provided success to a point. However, when we 

really want someone to make an impact and to make the right financial decisions, that’s where we find personal advice is really 

helpful. And I think the same situation is here, where individuals 

need to talk to someone, to really understand all the different and 

consider all the different points in their personal situation before 

making those decisions. 

The CHAIRMAN. Given the advantages of waiting to take their 

benefits, why do you think so few women in fact do wait? 
14 

Ms. O’DONNELL. I think some are just ill informed in terms of 

not understanding. I think some people—based on our research, we 

find that generally inertia is one of the biggest attitudes and behaviors. So inertia would say just to take it at 62 because that’s 

what everyone else does. There’s also uncertainty. There can be uncertainty about the stability of the Social Security System, and so 

some may feel that a bird in hand is better, even if it’s not. 

I think that they have not had the benefit of financial professionals really explaining to them the true benefits of deferral. 

The CHAIRMAN. So you also feel that to some considerable extent 

the reason more women don’t defer is because they don’t fully understand the ramifications? 

Ms. O’DONNELL. Definitely. 

The CHAIRMAN. Do you feel that way, Ms. Bovbjerg? 

Ms. BOVBJERG. I do, and I would just like to point out that 46 

percent of unmarried people are relying nearly entirely on Social 

Security, 23 percent of couples. Those are a lot of people who are 

not going to have financial advisers, number one; and number two, 

they’re really looking to Social Security for help. SSA’s all they 

have available to them in retirement. 

So I really think that it is important that we use the Social Security platform to try to reach people. I don’t disagree on getting employers more informed and certainly having employers help people 

when they consider their retirement options. But I think that it’s 

really fundamental that SSA step in. 

The CHAIRMAN. Without being critical or personal here, but what 

I hear you saying is that this population of women would be better 

served if they had better information on the ramifications of when 

to start taking Social Security. And I think I hear you saying—and 

I’d like to hear you comment on that, LaTina—that, while Social 

Security should not—SSA should not be responsible for making 

those judgments, there is a question about whether or not SSA 

would be serving this population more fully if they were not given 

more information, a more clear understanding of the ramifications. 

That’s not suggesting that there’s anything being done wrong 

right now, just how we can make it better. I guess I’d be interested 

in your opinion. 

Ms. BURSE GREENE. We completely understand your concerns. 

We would be willing to sit down with you and your staff to try to 

look at your suggestions on how we can frame retirement options 

in a way so that we’re not influencing them and not advising them 

on which decision to make. So I think we welcome that discussion, 

but again we have to do it in such a way that we’re not influencing 

them in a particular direction. 

Ms. ENTMACHER. Senator Kohl. 

The CHAIRMAN. Yes? 

Ms. ENTMACHER. If I could just add something to the conversation here. We do some education through webinars with women 

and I certainly agree that better understanding of the consequences of the decisions people make about claiming Social Security, the consequences of a spouse’s decision, is very much needed 

and would be very helpful. 

But there are quite a number of women and men who really 

don’t have a choice, particularly in the last few years with pro-
15 

longed periods of unemployment for many older workers who have 

lost their jobs, who can’t get back into the workforce. We hear from 

women who say, you know: I’m 61 years old, I’ve been looking for 

work and looking for work. They know their benefits are going to 

be cut, but they don’t know what they’re going to live on. They 

don’t have $100,000 in an IRA that they can use to tide them 

through, and they’re really struggling and, quite frankly, taking 

Social Security may be better than charging a lot on a credit card 

just to make ends meet. 

I know in some of the other bills you’ve introduced you’ve recognized some of the employment challenges that older workers face. 

So there certainly are people out there for whom realistically waiting is not an option, and we have to address the broader picture 

of economic challenges. 

The CHAIRMAN. Yes, very good. 

Ms. Schaeffer, in your testimony you’ve referred to the idea of 

moving the retirement age possibly back. Yet GAO has previously 

reported to us about the unintended consequences of such an action, an increase, for example, in disability claims and a cut in benefits for those whose physical health or taxing jobs are forcing them 

to retire early. 

So how do we move back the age while still protecting these people who need the benefits the most at an earlier age? 

Ms. SCHAEFFER. Well, I think the first thing that we’re all sort 

of recognizing is that there are some serious challenges to a defined 

benefit system, and that, while we’re talking about all of these benefits they don’t come without a cost, and that we have to remember 

that the current system is currently financially unsustainable. 

So there are going to be winners and losers in the way that it’s 

reformed, but we have to do something because currently future 

workers aren’t going to be seeing any of their money. So I think 

that the biggest point that I could make here is the importance in 

having a system that allows for flexibility, control, and ownership, 

so that people can plan and can design a retirement system that 

fits the needs of their family and their health, considers their 

health needs, their employment prospects, and allows them the 

greatest ability to be flexible throughout their time that they’re in 

the workplace or at home. 

I think that you’re pointing out a very important issue about the 

age at which we retire, but I think that we need to be very clear 

that in 1940 a man who reached age 65 was expected to live only 

12.7 more years, a woman only 14.7 more years, but by 1990 the 

65-year-old man is expected to live 15.3 years and a woman 19.6 

years. That’s 2.5 more years of payments for the man and 5 more 

years of payments for the woman. That’s wonderful that our life expectancy is increasing, but we again have to recognize the real actuarial cost that this means for all of us in terms of taxpayers. 

The CHAIRMAN. Thank you. 

Ms. Entmacher, as we know, we have a special minimum benefit 

today. But we understand that it was not really reaching people it 

was intended to cover. In many cases it is not. Can you tell us why 

that is and what are some of the ways we can fix this benefit to 

ensure that it protects the very poorest of the poor? 
16 

Ms. ENTMACHER. Well, there are several reasons why it’s not 

working. Just to illustrate how dramatically it’s not working, about 

40 percent of women workers receive a Social Security benefit that 

isn’t enough to bring them out of poverty, whereas the special minimum benefit helps just over one-tenth of one percent of all beneficiaries. So it clearly is not reaching people that it was intended 

to. 

There are several reasons for that. One is that, while the regular 

Social Security benefit formula keeps pace with—is wage indexed, 

it keeps pace with increases in the standard of living, the special 

minimum benefit is not. It’s indexed to poverty, so it shrinks every 

year. 

The second problem with it is that it requires a very substantial 

level of earnings to get a single year of credit toward the special 

minimum. For example, you must earn $12,280 a year to get one 

year of credit toward the special minimum. To get a year of credit 

toward regular Social Security is $4530. And if you fall even a dollar short of that $12,280, you don’t get any credit. 

That may not seem—$12,000 may not seem like a lot to some of 

the people in this room, but if you’re working for minimum wage 

that’s virtually full time, year-round minimum wage work. The nature of the low wage labor market is that low wage workers often 

can’t get steady work. It’s a seasonal labor market, jobs are temporary. Low wage workers have more struggles to pay for 

caregiving, so they may lose time out of the labor force when they 

can’t go to work. They don’t get paid time off to care for a child. 

They’re more prone to disabilities. 

So that you’ve got a concentration of people who have interruptions in their work histories, as well as the nature of the labor 

market, that people often don’t have that kind of steady work. So 

it’s hard to qualify for benefits. 

The amount that we give people under the special minimum isn’t 

enough to bring them out of poverty even if they have 30 years of 

these earnings. And we don’t give any credit for caregiving. 

So those are four ways that I’ve suggested to improve the special 

minimum: first of all, to make sure that it gives people at least 125 

percent of poverty; to lower the amount needed to qualify for a year 

of credit; to index benefits to wages instead of prices, the way regular benefits are indexed; and to give eight years of caregiving 

credit, and that would make it much more effective. 

The CHAIRMAN. Good. 

Ms. ENTMACHER. Thank you. 

The CHAIRMAN. Other comments from the panel? 

[No response.] 

I am encouraged with the thought that we can work together, 

Ms. Greene, with you and your agency to be sure that we get as 

close to 100 percent as possible of information and understanding 

out there to women who are approaching 62 on some of the benefits 

of waiting until 66 or 70. I think we all feel that can make a big— 

really advantage the system, advantage the situations of these 

women who so clearly would be in a better situation and a better 

benefit if they waited. 

Who else wants to make comment? Yes, Barbara, go ahead. 
17 

Ms. BOVBJERG. I just did want to say that I thought that what 

I just heard about framing the issue is so important. We heard that 

when we spoke to our experts about different policy options over 

and over, that how we talk about it is really important. We’ve long 

thought that we need to be more consistent across government, and 

I think that what you’re suggesting is a really great start. 

The CHAIRMAN. And your point also that this huge gap between 

age 25 and age 60 when not enough information is getting out, so 

that when it gets out maybe at age 60 it’s a little too late in some 

cases for them to have made their plans and they didn’t understand the ramifications at an earlier time in their lives. We can do 

a better job with that also. 

How did it occur that we stopped sending out that information 

annually, do you know? 

Ms. BURSE GREENE. Yes. In March or April of 2011, furloughs 

were imminent at the time. We were spending $70 million a year 

in postage and mailing costs for the Statement. At that time, to be 

quite honest with you—and it was a very difficult decision to 

make—we had to figure out how we could continue to have adequate staff available to fulfill our mission-critical work, our mission-critical activities, be it processing claims, program integrity 

work, and so forth. 

The bottom line is that a decision was made that we would suspend mailing the statements so that we could take that $70 million—for fiscal year 2011 it was actually $30 million—and divert 

that to keep staff on duty in order to perform our mission-critical 

work. Since that time, as you know, we’ve developed online Statement that is available 24–7. We resumed mailing the Statement for 

individuals 60 and over who are not currently receiving benefits. 

On Monday we resumed mailing a one-time Statement to individuals turning age 25. As part of the President’s fiscal year 2013 

budget, there are sufficient funds for us to resume mailing the 

Statement to everyone who is not currently receiving benefits. But, 

of course, it depends on what the actual appropriation will be, that 

will determine the tough decisions we’re going to have to make 

going forward. We will continue to evaluate our options. 

The CHAIRMAN. Did I hear you just say that there are plans afoot 

to resume those mailings? 

Ms. BURSE GREENE. There are sufficient funds in the President’s 

fiscal year 2013 budget that is correct. But it remains to be seen 

whether or not we actually receive that budget. 

The CHAIRMAN. Did you refer also to the cost involved? 

Ms. BURSE GREENE. Correct. It costs $70 million a year. 

The CHAIRMAN. 7–0. 

Ms. BURSE GREENE. 70 that is correct, 7–0, for postage and mailing costs. 

The CHAIRMAN. Were we to resume an annual mailing to everyone? 

Ms. BURSE GREENE. That is correct. 

The CHAIRMAN. $70 million per year? 

Ms. BURSE GREENE. That is correct. 

The CHAIRMAN. All right, thank you. 

Senator Blumenthal, we’ve been waiting for you and your expertise. 
18 

Senator BLUMENTHAL. Thank you. 

Let me thank all of you for being here today. I apologize that I 

was delayed at another event, another meeting, and I just really 

want to thank you all for contributing so importantly to the work 

that we’re doing here, and thank our chairman, Chairman Kohl, for 

having this hearing on an issue that is so critically important, enhancing retirement security. 

Let me begin, Ms. Greene, if I may, by asking you what we can 

do and what your plans are to enhance the on-line tools? I know 

you’ve talked a little bit about it. Since the tools have been available, have you seen women retiring later and taking more advantage of on-line tools? 

Ms. BURSE GREENE. If I may just kind of bifurcate the two questions, I believe. 

Senator BLUMENTHAL. Sure. 

Ms. BURSE GREENE. I think your first question deals with whether or not we’ve seen any trends in terms of claiming behavior of 

women. There has been some recent research by the Urban Institute—that study was actually funded by Social Security—that concluded that there has been a downward trend when you look at cohort behavior and claiming behavior. So, there has been a decrease 

in claiming at age 62 over the last 10 years or so. 

There was a spike, I want to say, around 2008, 2009, but I think 

thus far that downward trend will likely continue over the next 

several years. My recollection, and I can confirm this for the record, 

is I don’t recall there being any distinction between claiming by 

men and women. But again, I can go back and verify that for the 

record. 

Senator BLUMENTHAL. And by downward you mean lower retirement age? 

Ms. BURSE GREENE. People are delaying their claiming decisions 

until later ages. So they’re not all claiming at age 62, but maybe 

at 63 or 64. Again, we can go back and look at the data itself and 

provide more specifics for the record. There is a downward trend. 

Senator BLUMENTHAL. I’d be interested in that. And you rightly 

bifurcated the two questions. You have seen essentially higher age 

retirement, a trend toward higher age retirement, is that fair to 

say? Is that what you —— 

Ms. BURSE GREENE. There has been a downward trend in claiming at age 62. So I believe at one point in time, when you look at 

cohort data, 53 percent of the beneficiary population was retiring 

at age 62. I think now it’s maybe 50 percent of the beneficiary population, when you look at cohort data specifically, are now retiring 

at age 62. So there has been a downward trend, and again I would 

prefer to provide more information for the record. 

Senator BLUMENTHAL. I’d be very interested in those numbers. 

Then to take the second part of the question, use of on-line tools, 

any trends there? 

Ms. BURSE GREENE. Well, specifically for the online Statement, 

in a two-month period, we’ve had about 1.1 million individuals successfully register for our online Statement. Of those who successfully registered, 35 percent are within the 60 to 69 age category, 

another 33 percent are within the 50–59 age category. 
19 

So we’re pleased with the results that we’ve seen so far and the 

interest in our online Statement. We will continue to use traditional and non-traditional means of communicating with individuals about online Statement availability. 

Senator BLUMENTHAL. Let me ask you—and I would open this 

question to any of the others who are testifying today—increasing 

the eligibility age; do you have an opinion as to whether that step 

would increase the number of women living in poverty? For you or 

anyone else who might want to answer. 

Ms. ENTMACHER. Well, I will take a stab at that, Senator. I’m 

Joan Entmacher. I’m testifying on behalf of the National Women’s 

Law Center. We are concerned that it would, because raising the 

retirement age is really a benefit cut. It’s nearly 7 percent a year 

for every additional year. As I said earlier to Senator Kohl, there 

are people who don’t have the option of waiting. They may not have 

sufficient financial resources to cover them until they claim Social 

Security. They may have worked in a low-paying job most of their 

life, have very little saved and be unable to find a job. 

Obviously, it’s particularly hard today. Duration spells of unemployment are particularly hard for the elderly. Even before the recession, it was very hard for many older workers to get back into 

the labor force. They just weren’t that attractive to some employers. 

So what this does is simply reduce the Social Security benefit for 

people whose benefits are already particularly likely to be low. The 

people who claim early are disproportionately lower income workers. So it is a problem. 

Doing something that doesn’t involve raising the retirement age, 

but that does talk about different ages in a different way, that encourages people who can wait to do so, instead of saying 66 is the 

full retirement age, say 70 is the highest benefit age, and encourage people to think about these years differently, that could be 

positive. I don’t know what the best words are and we’d have to 

check messages, but that’s very different from actually changing 

the retirement age and lowering benefits for people who claim before that older age. 

Senator BLUMENTHAL. Are there reliable studies on whether it’s 

more difficult for men or women to get back into the workforce at 

certain ages? 

Ms. ENTMACHER. We can get back to you with some more studies. 

The National Women’s Law Center has been looking at duration of 

spells of unemployment for older women and men. The numbers 

have jumped around a little bit. For a period of months it’ll be 

longer for women and then you’ll look a few months later and it 

will be even longer spells for older men. All I can say is it’s very 

long for both older men and older women, and their unemployment 

rates are lower, but their duration of their periods of unemployment are higher, and it’s true for both men and women. But I don’t 

want to have a competition because it’s really tough for both. 

Senator BLUMENTHAL. If you could provide any studies that you 

think would be helpful or enlightening. 

Ms. ENTMACHER. I would be happy to do that, Senator. Thank 

you. 

Senator BLUMENTHAL. Great. 
20 

Let me ask Ms. O’Donnell, can you talk a little about what we 

can do, what government can do, to make sure that there is better 

information and more information about what people, what women 

need to do in saving for retirement? 

Ms. O’DONNELL. From our perspective and where our expertise 

lies, we’re really about working with employers as part of their 

401(k) plan and benefit plans. I think having the government urge 

more employers to help individuals and their employees with retirement income solutions, providing help with retirement—with 

Social Security strategies, would be very helpful. 

The 401(k) is unique in that next to Social Security it’s the largest source of retirement income for many workers, and it also has 

the benefit of providing an environment with lower fees, fiduciary 

oversight from the plan sponsor. So there is more of a protected environment from the employer. So anything the government can do 

to encourage employers to offer more retirement income help 

through their 401(k) plans and to include Social Security as part 

of what they should be providing help on we believe will be very 

impactful. 

I’ve been doing work with very large employers and their employees and we believe that one of the things employers are most excited about is looking at Social Security optimization and specifically deferring Social Security, because it’s something that is not 

well known and they realize that it’s probably the biggest impact 

later in life that one can have on their retirement income. 

Senator BLUMENTHAL. Have you noticed any scams or other 

kinds of improper schemes preying on this area of retirement 

plans, and have you noticed any trends, either increasing numbers 

or anything that might be helpful to us? 

Ms. O’DONNELL. Yes. I don’t have specific studies. There are not 

a lot of studies on scams, I guess. But what we do hear from our 

employers—and they’re very large employers—because of the demographics of the number of people retiring right now, there are 

different types of unscrupulous investment advisers who basically 

wait for people to retire, to have the lump sum. They circle the 

parking lots, they put flyers on the windshields of the cars, and 

they’re waiting for people. Then typically what happens then is 

that they are selling them higher-priced investment products that 

may or may not be in their best interest. 

So that is one of the things that we feel is so beneficial about 

the 401(k) system, is that it provides that protection for the individual. And typically, because of the large scale and the number of 

assets that are in a 401(k) plan, the employer is able to get lower 

priced investment services and products available. 

Senator BLUMENTHAL. Do you think that there’s sufficient enforcement against these kinds of scams? 

Ms. O’DONNELL. I’m unsure about—that’s something I probably 

shouldn’t comment on. I don’t really understand that. I do know 

that it is an employer concern and that they—because we are an 

independent fiduciary to the employer, it’s something that—having 

our services is something that they want because they do not want 

others—their employees looking to outside of the plan for help that 

may not be in their best interests. 
21 

Senator BLUMENTHAL. They want you so that someone unscrupulous isn’t the one taking advantage of their employees. 

Ms. O’DONNELL. Right. 

Senator BLUMENTHAL. But do you know whether they report 

these kinds of problems when they see them? 

Ms. O’DONNELL. I’m unsure. I know that they talk about them 

anecdotally, but I’m not sure whether they report them to the government or any agencies. 

Senator BLUMENTHAL. Let me ask you and any of the others who 

are here whether you are concerned about elder abuse, of women 

in particular, elder financial abuse. Elder abuse is normally associated with physical abuse, but one of my interests is in abuse financially, by caretakers, by financial advisers, the spectrum of people 

who are in positions of trust vis-a-vis the elderly. And it affects 

women as well as men, obviously. So I’d be interested in any perspective you can offer. 

Ms. BOVBJERG. If I may, Senator. GAO has some work under 

way for this committee on elder abuse and financial exploitation. 

I was just checking to see when we’re releasing it. It looks like it 

won’t be before Thanksgiving. 

Senator BLUMENTHAL. Before Thanksgiving? 

Ms. BOVBJERG. Yes. Yes. I can’t tell you anything about it now. 

It’s coming in November, but it is work we have under way. 

Senator BLUMENTHAL. Okay. Well, thank you. That will be very 

helpful and very important. I don’t know whether you ever offer 

previews of coming attractions. 

Ms. BOVBJERG. Usually not in a hearing environment, but we 

would be happy to come and speak with you. 

Senator BLUMENTHAL. Well, I was going to suggest if you could 

talk to us I would appreciate it. 

Ms. BOVBJERG. If the committee is interested, we could arrange 

to have a briefing. 

Senator BLUMENTHAL. Thank you. 

Any other perspectives or thoughts about that issue, elder financial abuse? 

[No response.] 

Well, I want to really thank all of you for being here today. 

Thank you very much, Mr. Chairman, it’s been very important 

and useful, and I will be very interested in the additional information that you may be able to get us. Thank you. 

The CHAIRMAN. Thank you very much, Senator Blumenthal. 

We thank you all for being here today. You have cast light on 

an important subject and so your taking the time to come has been 

more than worthwhile. 

This hearing is adjourned. 

[Whereupon, at 3:14 p.m., the hearing was adjourned.] 

(23) 

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Æ