3 Reasons Women Need To Plan Carefully For Social Security

Social Security often serves as a major income source for both male and female retirees. But those in the latter camp need to be even more strategic about those benefits. Here are three reasons why.

1. Women Tend To Live Longer Than Men

The average 65-year-old man today can expect to live until age 84.3, says the Social Security Administration, while the average 65-year-old woman can expect to live until 86.7. That may not seem like such a large gap, but consider this: It's estimated that 90% of women will eventually be responsible for their own finances down the line, in the absence of their long-term partners. As such, it's especially critical that women maximize their Social Security benefits -- because they're likely to collect them for longer.

2. Women Typically Earn Less Than Men

You'll often hear that women's earnings pale in comparison to men's, and while you'll see different statistics relating to the wage gap, as a general rule, females only earn about $0.78 to $0.82 for every dollar their similarly qualified male counterparts bring home. As such, they stand to collect less from Social Security, since benefits are calculated based on workers' 35 highest years of earnings. Compounding the problem is that women are also more likely to take extended breaks from the workforce, often to raise children, and therefore frequently don't have a full 35 years of work on record. When that happens, a $0 gets factored in for each missing year of work, thereby bringing those benefits down.

3. Women Often Have Less Retirement Savings Than Men

Because women earn less than men and are also more likely to take time out of the workforce, they often struggle to set aside funds for the future. In fact, a study released last year found that women are saving only about half as much as their male counterparts. The result, therefore, is that women are more likely to rely heavily on Social Security in retirement to make up for their lower IRA or 401(k) balances.

Making The Most Of Social Security

Clearly, Social Security plays a critical role in women's retirement. The good news in this regard is that women can take steps to get more money out of the program.

For one thing, filers who delay benefits past full retirement age get an 8% boost for each year they hold off on claiming them. That means a woman with a full retirement age of 67 could wait until 70 and grow her benefits by 24% -- for life. (Delayed retirement credits that produce the aforementioned boost cease to accrue at 70, which is why delaying past that point isn't necessary.)

Working longer achieves an additional goal that helps from a Social Security standpoint -- filling in gaps for years spent away from the workforce. A woman with just 32 years of work on record, for example, could retire at 70 instead of 67 and add three more years to her work history for a total of 35.

Fighting for more money on the job can also work wonders for Social Security purposes, not to mention make it easier for women to save for retirement on their own. An estimated 56% of employees have never come out and asked for a raise, according to job site CareerBuilder, but of those who have, 66% got pay boosts. Researching salary data can help women approach those conversations more confidently, especially when they can prove that they're statistically underpaid.

While Social Security isn't designed to sustain retirees on its own, many women will wind up leaning heavily on those benefits down the line. By taking steps to get as much money as possible out of the program, women can reduce their likelihood of struggling financially during their golden years.

This article originally appeared in the Motley Fool.

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