Social Security: Your Earnings and Benefit Estimate Statement
By: Adam Ledbetter, CFP^®
The Henssler Financial Group Position Paper

The Social Security Administration sends annual copies of the "Earnings and Benefit Estimate Statement" to all workers age 25 or older. The report is sent to each participant approximately three months before his or her birthday. This annual report summarizes both the earnings record and the estimate of future Social Security benefits for each individual who pays Social Security taxes.

This report contains the following information:

• The individual's Social Security taxed earnings, as shown by the Social Security Administration records, as of the date selected to receive a statement;
• An estimate of the Social Security and Medicare Hospital Insurance taxes paid on the individual's earnings;
• The number of credits (quarters of coverage, not exceeding 40) that the individual has for both Social Security and Medicare Hospital Insurance purposes, and the number the individual needs to be eligible for Social Security benefits and for Medicare Hospital Insurance coverage;
• A statement as to whether the individual meets the credit requirements for each type of Social Security benefit, and if the individual is eligible for Medical Hospital Insurance coverage;
• Estimates of the monthly retirement, disability, dependents' and survivors' insurance benefits potentially payable on the individual's record if he meets the credits requirement;
• A description of the coverage provided under the Medicare program;
• A reminder of the right to request a correction in an earnings record, and
• A remark that an updated statement is available annually upon request.

If you did not receive a copy in the last year or wish to receive an additional copy, you have several options:

Telephone:
Call 1-800-772-1213 and request a Personal Earnings and Benefit Estimate Statement Form (PEBES), Form SSA-7004.

In person:
Go to any Social Security office and request a PEBES Form. Address of a local office: U.S. Social Security Administration, 1415 Franklin Road, SE, Marietta, GA 30067

Internet:
Log on to the Social Security web site: www.ssa.gov. Internet users have two choices:

• Complete the form online and receive a response by U.S. mail in two to four weeks. This service is available Monday-Friday except between 2 a.m. - 3 a.m. EST; Saturdays and holidays 5 a.m. - 11 p.m. EST, and Sundays 8 a.m. - 10 p.m. To use this service, the user will be required to provide the following:
  • name as it appears on Social Security card;
  • Social Security number;
  • date of birth;
  • state of birth, and
  • mother's maiden name.
• Download the form, complete it and mail it to the Social Security Administration. This can be done 24 hours a day, seven days a week. You should receive a response by U.S. mail in four to six weeks. The completed form should be mailed to:
  • Social Security Administration, Wilkes Barre Data Operations Center, P.O. Box 7004, Wilkes Barre, PA 18767-7004

To apply for Social Security benefits:

Applications for Social Security benefits should be made on the form prescribed by the Social Security Administration. An individual can apply either online, by telephone or in person at a field office. See above for addresses and telephone numbers.

When you receive this report, you should:

• Review the earnings summary and make sure you are being credited for any earnings that have already been taxed by Social Security. If you notice any earnings missing, contact the Social Security Administration. Remember, your earnings may appear lower than your actual earnings in various years. The reason — Social Security taxes are paid only on earnings up to a certain dollar amount each year, maximum of $102,000 in 2008. Medicare taxes, however, are paid on all earnings, with no upper limit.
• Review your estimated future benefits. This should give you a general idea of how much you can currently expect to receive from Social Security at your retirement. These figures can be used when estimating future income needs from your portfolio, or when determining appropriate spending levels that can be maintained throughout your life.

For more information, you can visit www.ssa.gov, or contact The Henssler Financial Group at 770-429-9166 or comments@henssler.com.