Photo by: NCL

What Every Stay-at-Home Mom Should Know about Social Security & Medicare

Photo by: NCL

Every May, in honor of Mother’s Day, Salary.com announces how much the work of a stay-at-home mother is worth. Her annual salary, or value, since in the real world the salary is a fantasy: A whopping $122,732. (And that’s based on only 10 job functions typically performed by stay-at-home moms.) It’s nice to be valued.

What isn’t so nice is that although stay-at-home moms are given lip service about their value and importance, full-time stay-at-home motherhood is not recognized in any way as the job it really is. While I’m not saying stay-at-home mothers (and dads) should be paid a salary, per se, it sure would be nice if those years as primary caregivers of young children weren’t so potentially damaging to a full-time parent’s future Social Security and Medicare benefits.

(A caveat: For purposes of this discussion, let’s just assume that Social Security will be around when you become eligible to collect retirement benefits. Currently, the age at which people born after 1960 can collect full benefits is 67. Please put out of your mind the possibility that by time you’re 67-years-old the full-benefit age will be 92.)

Here’s the rub: A person’s Social Security benefit—which is the value of the monthly check she will receive in old age—is based on having a total of 35 years of paid employment. For each year worked, a certain number of “credits” are provided. You need to have 40 credits to be eligible for your own Social Security retirement and Medicare health insurance benefits. (At the current four credit maximum per year, that requires at least 10 years of employment.) To calculate the value of a person’s retirement benefits, the Social Security Administration totals the earnings from the highest 35 years of income, and then divides that number by 35. Using various rate sheets and tables, that sum is then translated into a benefit. Men generally have no problem meeting or exceeding a work-life of 35 years (unless of course they die). Women have a tougher time.

The unfairness of the benefits formula is that a woman gets zero—zippo, nada, a big N.O.—benefit or recognition for the years she works around the clock as a stay–at–home mom. As women are more likely than men are to step in and out of the workforce, a woman’s 35 years often includes many years of zero or near zero income, which drags down her average and is one of many reasons a woman’s Social Security check is commonly smaller than a man’s.

Naysayers argue that because stay-at-home moms don’t earn an income, they don’t contribute to the economy or the Social Security coffers. A counterargument is that stay-at-home mothers do contribute mightily to the economy as consumers and as part of a taxpaying couple. Because there is no “official” benefits-related recognition of the work of stay-at-home mothers, women (as well as an increasing number of men) are essentially having to choose between their children’s immediate needs and their own need for financial security in old age.

In an article for the advocacy organization Mothers and More, its president at the time, Kristen Maschka, calculated that by leaving the workforce for seven years to stay home with her child, she would be forfeiting $2,000 a month in future Social Security benefits. “Assuming I live to be eighty-seven,” she writes, “that’s nearly half a million dollars.” (Another great advocacy organization for moms is MomsRising.org.)

The cost of an unpaid stay–at–home career—or a paid career that makes accommodations to parenting responsibilities—varies for each woman.

You can calculate both your future benefits and losses by visiting www.ssa.gov/planners/calculators.htm.

THE 50 PERCENT SOLUTION

In lieu of recognizing that stay–at–home parenting is work, the government allows a married woman to collect off of her spouse’s work history instead, if receiving 50 percent of his benefit amount calculates to being more than 100 percent of hers. (And this scenario is also true in the other direction, with the husband collecting based on his wife’s earnings.) So if a woman and her spouse make it to retirement together and an anniversary of more than a decade of marriage, she can collect either her benefit or an amount that’s half of his. For example: If John gets $5,000 a month, Jane gets $2,500, so as a couple living together they bring in $7,500 monthly.

A divorced woman can collect spousal benefits, so long as the marriage lasted 10 years. In such a scenario, a divorced Jane who had 10-plus years vested in a marriage can still claim the 50 percent spousal benefit, but since she’s no longer in the same household as John, unless she remarries, the Social Security income coming into her home is just $2,500 instead of the $7,500 she would have had access to had the marriage not dissolved.

Unfortunately, because of the decade rule, a woman who stayed home with her children for nine years of her nine-year marriage receives no spousal-linked Social Security or Medicare benefits. An unmarried stay–at–home parent who has children with a partner has no protection. If she has her own work history, she may have access to a benefit of her own. But if she were a teenage or young mother and continues to have a minimal employment history, she’s at risk of becoming a very poor old lady.

Another inequity: Stay-at-home parents don’t qualify for private disability insurance because such insurance is for replacing income from work, but sometimes it’s their work that needs replacing. If something terrible happens to a stay-at-home mom and she can’t work for a year (as a stay-at-home mom) will her family be able to afford the $122,732 needed to hire her replacement?

For more information about your Social Security eligibility and benefits, visit the Social Security Administration website at www.ssa.gov or www.ssa.gov/women.

Melissa Stanton is a mother of three, former editor at Time Inc. magazines, and the author of The Stay-at-Home Survival Guide: Field-tested strategies for staying smart, sane, and connected while caring for your kids (Seal Press/Perseus Books, 2008). Her website is www.RealLifeSupportforMoms.com.

Like This Article

Like Mamapedia

Learn From Moms Like You

Get answers, tips, deals, and amazing advice from other Moms.

18 Comments

Started my on the books work history at age 12.. Full time by age 16. 2 jobs by age 19. Worked until I was 25 and started my family. I was a stay at home mom for just shy of 10 years- until my youngest started school. During that time I was diagnosed with a brain malformation. While I was deemed medically disabled, I found out I lost all of my work credits and didn't qualify for benefits. Discovered all 3 kids had same genetic malformation. 2 are disabled...

See entire comment

I was a SAHM for 10 years of my 25 year marriage so I lost 10 yrs of SS pymts. Since I retired at 62 and my ex also retired at 62 and we were married more than 10 years I could technically draw 35% of his SS retirement or draw my own. His is about 1600.00 and mine is 945.00 so my own is more. However, I wish there was a way the govt would determine what he earned in those 10 years I was a SAHM ....do the normal calculations of that figure then add 35% of that final figure to my 945.00...

See entire comment

Some people here need to check their History. SSI started as a voluntary full retirement plan. You got back what you paid in and only if you paid in(exception-wives and husbands could get it through what you paid in). It was started by Democrats and has been change by the corruption of the Democrats over the years, in such a way that hurts those who pay in...

See entire comment

Leave a Comment

Required
Required (will not be published)
Required (to prove you're human)
Comments are moderated and generally will be posted if they are on topic and not abusive
For Updates and Special Promotions
Follow Us
Want to become a contributor?
Want to become a contributor?

If you'd like to contribute to the Wisdom of Moms on Mamapedia, please sign up here to learn more: Sign Up

Recent Voices Posts

See all