It’s hard to imagine a more important financial law than the Social Security Act of 1935. For most of us, Social Security will be the foundation of our retirement income. And, for the vast majority of retirees, it is the single most important reason they live above the poverty level. So, it was to be with much fanfare that we recognized and celebrated that Social Security turned 85 on August 14th, 2020.
Unfortunately, with the drama and trauma of what 2020 has turned out to be, this incredible milestone was nearly missed. But not here in my Plymouth office! I’ve continued to write about and talk about this most important foundation for nearly everyone’s retirement.
And to think, the workers of the 1930’s did not welcome this social insurance program with open arms…
Social Security was rebuffed in the 1930s
When first passed into law, citizens were still reeling from the effects of the Great Depression. Social Security was not a welcome program. Many Americans did not want to receive any kind of handout. They were hard-working, proud people who wanted jobs. And a better life for their children. Not gimme’s from the Federal Government.
In some of the historic text of the bantering about Social Security, it was clear that this had to be a pay-in system. It could not be a form of welfare. Workers were to pay in during their working years in order to receive an insurance benefit later in retirement.
My, oh my, how much changes over 85 years! Today, I often meet with individuals or give a Zoom presentation about Social Security. Or, I fondly remember the days when I traveled and presented to large audiences around the country. By and large, the near-retirees of today not only want their Social Security benefit, but they want it now. They have been expecting it for decades. And, they are bitterly disappointed that it so much smaller than they thought it would be.
Near-retirees feel cheated that they didn’t know or understand how Social Security works. Now, many have to rethink their retirement.
A critical program for women in retirement
Despite it’s less than embracing welcome, Social Security was a pivitol program for women’s financial independence. Or, at least for their financial security and stability in old age.
In an article I wrote for Retirement Daily on The Street, I cover the early history of Social Security. Initially, it only covered workers who held certain types of jobs. They were jobs not available to most women, if a woman even worked outside the home.
You can link to the article here: Happy Birthday! Social Security Turns 85. You can read about the norms of the day when Social Security was written into the laws of the land. And, how it had to be revised almost immediately to protect more women. You’ll also get a glimpse into how men were excluded from several key protections from the law. And, I make a few suggestions for how Congress could shore up this vital security program for generations to come.
There’s also a short video embedded at the top of the article. You can tune in to my conversation with Retirement Daily editor, Bob Powell. I hope you’ll take a look.
The road to a woman’s financial independence relies on Social Security
We’ve reached many important milestones with laws that help women achieve more and more financial independence. You can hear my discussion with Jean Chatzky on the HerMoney Podcast. We discussed many reasons why Social Security is so important to women’s financial futures.
Social Security is one of the most important laws for women. Not only does the income help women pay bills throughout retirement, but it helps them leave a legacy.
For many women, one of the greatest gifts we worked so hard for, is leaving something to our kids. Or to our grandchildren. And, maybe to an important charity. If we have to spend down our own personal savings, there’s nothing left for those we love. That doesn’t feel good. Be it nature or nurture, a goal that drives women is their ability to give. And leaving a little something at the end of their days signifies a life well-lived.
Happy Birthday! Social Security turns 85
So, for eight decades, Social Security has afforded millions of women to deliver on one of her most important dreams. To leave that little something for her family when she’s gone. That’s a pretty powerful, yet unintended, result of a social insurance program born out of the Great Depression. Likely not a wish from Congress when they wrote the Social Security Act. But, what a fine way to celebrate that Social Security turned 85 in 2020. A major birthday milestone, indeed.