Each year since 2000, I have received an annual social security statement that reports the amount of my estimated monthly social security payment were I to begin my payments at 62, my full retirement age (which for early boomers is 65, although for me it is 66 and 4 months) or 70. Because I didn’t recall getting my statement last year, this year’s statement was a timely arrival since I had been intending to look up my numbers after reading several articles on social security withdrawal strategies. As it turns out, I didn’t get one last year and possibly neither did you.
To save approximately $90 million in 2011 and 2012, no statements were sent to workers for about six months last year and beginning in late 2011, only those age 60 and above who are not yet collecting social security will get them. This could be a problem for middle-aged and younger workers thinking about their eventual retirement. After all, to build an effective financial plan that includes retirement, you need to know your numbers. And, in addition to being packed full of information, simply receiving a social security statement in the mail (generally, about three months before your birthday) often serves as a good reminder about the need to plan for retirement.
However, the good news is that you can now look up your social security statement online… something that I did not know about until I came across Michael Kitcesan’s May 22, 2012 blog post, “A New Way to Review Client Social Security Benefits – Online!” I followed his instructions and eventually accessed my benefits information. I even read it! Like in the paper statement I had just received, there’s an electronic version that contains a ton of useful information and also includes new disclaimer language that addresses the uncertainty surrounding social security:
“Your estimated benefits are based on current law. Congress has made changes to the laws in the past and can do so at any time. The laws governing benefit amounts may change because by 2033, the payroll taxes collected will be enough to pay only about 75 percent of scheduled benefits.”
Back in 2000 when I first received a paper statement, retirement seemed so far off that I wasn’t prepared to evaluate what the estimated benefits would mean to me and my family. Twelve years later and now much closer to retirement, I look at my projected social security benefits with new, albeit older eyes. Even with the disclaimer, the statement now gives me reassurance that I will receive an income stream that I can count on. Whether you are on the cusp of retirement or still several years away like me, I highly recommend that everyone go to www.ssa.gov, create an account, look their numbers up and plan accordingly.
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