Economic Security for Families

All bereaved individuals should have the opportunity to remain financially solvent and stable in the aftermath of death.

Of the nation’s two million children who have a deceased biological mother or father, only an estimated 45 percent receive Social Security benefits. The number of fully orphaned children receiving the benefit is similarly low—49 percent. But when Social Security and other government programs are accessed, evidence suggests that child well-being is stabilized, thus plausibly facilitating better educational, health, and economic outcomes—a benefit not only to individuals but also to the nation in terms of elevated human capital, productivity, and innovation. Conversely, as a result of not receiving Social Security benefits, bereaved children are more likely to fail academically, grow up in poverty, and suffer from low lifetime earnings. To reduce lifelong poverty and inequity, the Social Security Administration should ensure that 100 percent of eligible bereaved children are enrolled in the Social Security benefit program.

For nearly a century, Congress recognized the unique needs of children, particularly those who experienced the death of a parent. In 1935, as an amendment to the Social Security Act, Congress expanded the law to include family benefits, including those for bereaved and orphaned children under the age of sixteen (or under age eighteen, if the child was enrolled in school full-time). In 1972, the House Committee on Ways and Means concluded that “a child who cannot look to a father for support . . . is at a disadvantage in completing his education,” whether in college or vocational school. In response, the committee provided postsecondary benefits to children up to age twenty-two to facilitate the completion of a four-year college degree. Since the elimination of this benefit, in 1982, researchers have found that college enrollment dropped by an estimated 18 percent among bereaved and orphaned children. Congress should reinstate the Social Security student benefit program for all bereaved and orphaned children.

In 1982, the Federal Trade Commission (FTC) released its Funeral Rule after discovering widespread deceptive practices in the funeral industry that limited consumers’ ability to make informed decisions. The Funeral Rule was aimed at prohibiting these practices; however, it has not successfully done so. In 1996, the Funeral Rule Offenders Program (FROP) was launched to address these persistent violations. But FROP is operated by the National Funeral Directors Association, an industry lobbying group, which means that offending funeral homes pay only 0.8 percent of their average gross income in penalties and remain anonymous to the general public, thus depriving consumers of important information that could protect them from predatory pricing practices. Recent FTC undercover investigations have found that funeral homes continue to offend yet are protected by FROP from the court of public opinion and the public’s elected representatives. In October of 2022, the FTC provided advance notice of proposed changes to the Funeral Rule. The notice outlines the intent to address funeral homes’ failure to furnish accurate price information, their requirement that consumers purchase services in bulk, and their imposition of a fee for embalmment without consumer authorization where embalming is not required by law. The timing of the proposed changes is unclear, and they may be challenged in court.

Bereavement is currently not acceptable grounds for taking unpaid leave under the Family and Medical Leave Act, despite recent efforts to add it. According to the Bureau of Labor Statistics, as of March 2020, only 58 percent of American workers have access to paid funeral leave. While 83 percent of the top 10 percent of wage earners have access to this benefit, the figure drops to 14 percent and 25 percent for the lowest 10 percent and 25 percent of wage earners respectively. Congress should pass a law requiring that employers grant five days of bereavement leave to each employee, thus ensuring job protection following a death event. Further, Congress should consider offering incentives to employers that continue to pay wages during bereavement leave, thus ensuring benefit parity between low-paid and high-paid workers.

By some estimates, there are more than eighty means-tested federal support programs. These programs largely provide two forms of assistance: healthcare security and income security, both pillars of Evermore’s policy agenda. There is some evidence that when bereaved children access federal programs, they are generally not as likely to experience greater poverty or hardship than their nonbereaved peers. Yet those same bereaved children are more likely to be expelled from school, be excluded from classes for gifted children, and have a disability. Of note, researchers have found that the younger a child is when a parental death occurs, the more likely that death is to cause cumulative hardship that follows a child for life. These hardships exacerbate racial and socioeconomic inequities, making upward mobility a substantial challenge for bereaved children and families. Congress should give states an incentive to enhance service coordination among existing federal programs, thus buffering vulnerable children from the shock of the death of a parent or guardian and thereby supporting children and families in crisis.

Although it is often invisible, bereaved people are at-risk of experiencing financial instability in the aftermath.