Many financial experts and planners often tout the benefits of verifying earnings records via annual Social Security statements.
And know that to stay on top of one’s potential future benefits is relatively easy. All one has to do is to create a mySocialSecurity account. By checking this online statement on a regular basis—at least once a year—one can immediately notify the agency if there are any errors in the earnings record and get them rectified quickly.
According to the Social Security Administration (SSA), “the amount of the Social Security benefit you or your family receive depends on the amount of earnings shown on your record. If all of your earnings are not shown on your record, this could mean lower Social Security benefits for you or your family.”
However, “if the earnings missing from your Social Security record are for the current year or last year, you don’t need to worry. Because these earnings are recent, we may not have recorded them yet,” it continued.
“That’s a valuable exercise for people to do to make sure they don’t have any misreported earnings,” Joe Elsasser, founder and president of Covisum, a Social Security claiming software company, told CNBC.
“Sometimes, people have a zero and they shouldn’t have,” he added.
Social Security Statement: Timeframe to Report Mistakes
But do be aware that one should report any errors as soon as possible due to enforced deadlines.
“You can’t correct your earnings after three years, three months and fifteen days from the end of the taxable year in which your wages were paid. However, you may correct your record after that timeframe under some circumstances,” writes one expert on Barron’s.
In addition, “try to collect proof of any missing or incorrect earnings, such as a W-2 form, tax return or wage stub. If you aren’t able to collect those documents, try to remember the name of your employer, the dates you worked there, and how much you earned. You may be able to correct your earnings record online, but you can also contact the Social Security Administration online or 800-772-1213 to work to correct your record,” she continues.
Social Security Statement: A Preview of Future Benefits
The online statement also features a handy blue bar graph that includes Social Security benefit estimates when claiming at nine different ages. Keep in mind that maximum benefits can be achieved if one files at age seventy.
“The blue bar form is a welcome addition for workers who need information to help them make good choices about their benefits,” David Freitag, a financial planning consultant and Social Security expert at MassMutual, told CNBC.
Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.