Widows Earn Less and Spend Differently

Older widows have less money and spend more of it on food, health care and shelter than women who are divorced or never married.

“Policy-makers may need to recognize that changes in Social Security, eligibility for public programs and rules regarding employment of older people affect widowed, divorced and never-married women differently,” a new report concluded.

“Because widows had a husband’s earnings, one might expect them to be better off than divorced or never-married women,” said F.N. Schwenk in her study.

But that was not the case.

Widows had average annual incomes of $9,777, while never-married women averaged $12,415. Those who had been divorced had average incomes of $11,077, according to the study of women age 65 and older living alone.

The study found that widows spent an average of $9,929 a year. Spending averaged $11,084 for those who had never married and $11,432 for divorced women.

Widowed and divorced women likely were drawing on savings but could also be borrowing using a home equity program, she said.

“Widowed women allocated a higher share of total expenditures to housing, food and health than the others,” Schwenk reported in Family Economics Review, a publication of the Agriculture Department. Her study was based on a survey of 3,395 women in 1988-89.

Widows spent 42% of their income, $4,182, on housing. Divorced women spent a bit more, $4,697, but that represented 41% of their income. Never-married women, on the other hand, spent $3,868 on housing, just 35% of income.

Schwenk said “widowed and divorced women may have higher housing costs because they may be living in the house where they raised their children, perhaps a larger house than a never-married woman would choose.”

Indeed, she found that the homes of never-married women averaged 1.9 bedrooms, compared to 2.1 for widows and divorced women.

Food cost widows 19% of their income at $1,884. As with housing, divorced women spent more, but their $1,952 in food costs amounted to a smaller share of income, 17%. That was the same percentage as never-married women, who spent $1,863 on food.

Health care followed the same pattern, costing widows 14% of their income, while the other two groups each spent 10%.

“Divorced women spent more on apparel and retirement, both work-related expenses. Never-married women allocated more to cash contributions and life insurance,” Schwenk reported.

Widowed women received about 60% of their income from Social Security, 17% from interest on savings and investments, 13% from pensions and annuities and 8% from earnings.

By contrast, divorced women received 48% from Social Security, 6% from interest, 18% from pensions and 20% from earnings.

For never-married women, Social Security provided 46% of their income; 19% came from interest, 28% from pensions and annuities and only 7% came from earnings.

Some 19% of divorced women were still working, compared with 14% of never-married women and 9% of widows.