Social Security


This past week over at U.S. News – Money, there was a post by Philip Moeller: “Don’t Get ‘Framed’ When Claiming Social Security.” Essentially the article is about how many people who are eligible to start their Social Security Benefit make their decision based on how the benefits are “framed;” that is, how they are presented to the potential benefit earner.

There are several different ways the situation can be “framed” which Moeller goes into detail about. We won’t discuss them here, except to say that each way of framing could lead to the same person with the same benefits to make a different choice about when to take his benefit. One way of framing may lead him to take his benefit at the earliest age of 62; another way of framing may lead him to take his benefit at 70.

Moeller’s point is that you should be fully informed about the ins and outs of your individual benefit and your potential lifetime benefit before making a decision. If you are presented with a certain way to look at your benefit, don’t assume it is the best option for you.

This is especially important if you are married, which may introduce the spousal benefit. Your decision about when to begin receiving your Social Security Benefit may potentially have a big impact on your spouse’s benefit. Many people don’t consider this when taking their own benefit.

Not considering all the avenues you can take with your Social Security benefits can cost you a lot of money over your lifetime. In some cases, taking benefits too early may cost you into the tens or even hundreds of thousands of dollars over the course of your life (depending of course on your benefit amount and how long you live).

Again, when you are getting close to Social Security eligibility, get to know your benefits. Be prepared before you get “framed.”

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.
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Social Security in the United States tends to be undervalued by many workers. Often people who are pre-retirement age don’t pay much attention to their annual statements received from the Social Security Administration (SSA), which shows both their earnings record and estimated benefit.

This has been compounded by the fact that last year, the SSA stopped mailing statements. So now, rather than receiving the statements in the mail and tossing them aside without much attention, you actively have to go searching for the info, which many will not bother doing.

While you may not think that you need to know your Social Security Benefit estimates, especially if you are younger and retirement is decades away, it is important to review your statement annually. Why is that? To ensure their accuracy!

Why Accuracy is Important

 The SSA is just as likely to make a mistake in reporting your earnings as any other company, through technological or human error. And, since there are so many workers to report too, it is highly unlikely they will catch that error without prompting.

Since your Social Security Benefits are paid out based on your highest 35 years of earned income (doesn’t have to be consecutive years), if the SSA is underreporting your earnings, you may end up receiving less benefit than you’re entitled to.

How to View Your Statement

 Since the SSA is no longer mailing monthly statements, you will have to retrieve the information yourself following these steps:

  • Go to http://www.SocialSecurity.gov/mystatement
  • Click Sign In or Create and Account
  • If you have not created an account previously, you must do so before viewing your information. Once you create an account, you will be able to use that login information in the future.

Information Needed:

  • Name
  • Social Security Number
  • Date of Birth
  • Address
  • Phone Number
  • Email Address

Follow the steps to create an account

  • Once completed and logged in, click Print/Save Your Full Statement on the main page.

The process is easy and fast. Once you have your statement, take some time to review your listed earnings. If they don’t match what you have on record, you can contact the SSA to correct the error.

While you may not think that Social Security is very important, you are paying into it with every paycheck. Don’t you want to take a few minutes to ensure that you will be receiving the proper benefits you deserve?

If you’d like to read some more on getting your benefits statement online, we recommend “A New Way To Review Client Social Security Benefits – Online?” by Michael Kitces. While the article is geared more towards advisors like us, it has some good info and tips for online security.

 

 

  • Disclaimer: The information on this blog is not meant for specific financial advice. The ideas/opinions stated are not suited for everyone, and readers should use their own judgment in applying them in their financial lives.