Why Older Women Overwhelmingly Live In Poverty — That Was My Trajectory

Women need to start sharing their money stories openly.

By Vicki Larson — Written on Aug 22, 2022

Photo: Stramp / Shutterstock

When I was 19, I dropped out of college to follow my boyfriend to Colorado, where he was going to attend college.

I didn’t know that I was going to end up supporting him with my minimum-wage jobs. But, I didn’t care; we were two young idealistic hippies who spent our weekends hiking in the Rockies with our pups. We married a few months before my 21st birthday.

We were poor, but money didn’t really matter all that much to me then. We had enough to get by, and life felt rich in so many other ways.

Still, all those years of working minimum-wage jobs were a drag.

Women overwhelmingly work low-paying jobs — as child and elder care workers, restaurant servers, maids, teachers, cashiers, retail workers, and receptionists. But even women with degrees and high-income careers typically make less than men do.

And then life happens.

Some women dial back paying work to be at home to raise children and then struggle to get back into the workplace; others quit altogether, sometimes willingly and other times out of necessity because of the high costs of childcare. Some have to leave their paid work to care-give a spouse, sibling, or parent, or in an increasing number of cases, to raise their grandchildren.

Some find themselves divorced at midlife, or widowed. Some may be happily single and then a financial crisis happens — an illness, a recession, a pandemic, furloughs, or layoffs. Some may have lost their job and are unable to find new ones because of ageism.

Some have worked hard all their lives and are still struggling because all women, but especially Black women and other women of color, Native American women, disabled women, and often queer and trans women make less than white hetero men.

And the ramifications of that are huge and lifelong.

In fact, it leaves many women in poverty as they age.

I eventually finished my college degree after divorcing my first husband, and started my life as a journalist — a rewarding career, but not a particularly financially rewarding career — married a second time and popped out two kids.

I did everything conservatives say I should do to be successful, the so-called success sequence — getting at least a high school diploma, a full-time job, and having kids after marriage — and yet when I divorced again in midlife, after working part-time for years while my kids were young, I was on the trajectory to becoming a poor woman in old age.

I had practically no money in a retirement fund. My new full-time job offered no pension and paid me much less than my male peers I later discovered (that has cost me tens of thousands of dollars and lowered Social Security benefits, but that’s a discussion for another day). My former husband was also a low-paid journalist so the alimony and child care payments I received were meager.

Divorce creates a huge shock to a woman’s financial health. Or, as one study notes:

“Women were strongly disadvantaged in terms of losses in household income and associated increases in the risk of poverty. Moreover, women’s disproportionate losses in these objective measures of economic status were permanent.”

Two things saved me — I bought the family house despite all odds, and my parents died and left me some stocks.

I never thought I’d be able to keep the house, but I didn’t need it for long — just a few years so my kids could finish their education in the same schools with the same friends. My former husband had bought the house, a triplex that we converted into a duplex, many years before as an investment, but didn’t want it when we divorced.

I didn’t want it either — it was old and falling apart — but thank goodness I bought it. I wouldn’t be able to afford an apartment, even a studio, anywhere in the Bay Area.

I took out a five-year interest-only loan, which didn’t require you to reveal your income, just that you were employed — the bank would have laughed and sent me on my way because I made a very low income then, and still do. The only reason I could swing it was because it has a small rental unit, which brought in essential income to help with the mortgage.

Still, there was no money for repairs, even small ones, and a house built in 1945 needs a lot of repairs.

It wasn’t until I inherited some stocks from my parents after they died that I could afford to properly maintain the house. It was nowhere near enough to retire on but more money than I ever had. When we talk about how generational wealth matters, this is why.

In truth, I was lucky. Lucky to be able to hold onto my house although I was bouncing checks left and right in the beginning — a poster child for the “house rich, cash poor” homeowner. And lucky that my parents gifted me with a small inheritance. But, I would rather they still be alive and enjoying the savings they worked so hard for.

I was always aware that, as the “poorest” of my friends, our lives were different. To be clear, anyone who owns a house in the San Francisco Bay Area cannot call themselves poor, and I don’t. If I sold my house, I’d make double what I paid for it, but I’d have to move out of the area after decades of building a community here. I need my community as I age.

That said, if I had to live on my salary alone, I would qualify for Section 8 housing and Supplemental Nutrition Assistance Program.

As a single person in my county, you can make up to $102,450 a year and be considered low income (I know, it’s shocking!), $63,950 a year to be considered very low income. Despite my salary and my rental income and all the other things I do to keep it all together, I still am a low-income earner. And that has shaped so much of how I move through the world.

It’s hard to talk about money with family and friends because so much emotion is wrapped up in it, shaped by our family of origin and society.

It’s a complicated relationship if you’re a woman, writes psychotherapist Kate Levinson in her book Emotional Currency: A Woman’s Guide to Building a Healthy Relationship With Money.