If you’re nearing retirement, ensuring the accuracy of your Social Security earnings record is crucial for maximizing your benefits. Mistakes in your earnings record can lead to lower retirement payouts, so it’s important to catch and correct any errors early.
What Is a Social Security Earnings Record?
Your Social Security earnings record is a detailed account of your taxable earnings for each year you’ve worked. It’s used by the Social Security Administration (SSA) to calculate your retirement benefits. Given that even small errors can significantly impact your future payments, understanding how to correct these records is essential.
Check Your Statement
The first step in verifying your earnings record is to review your Social Security Statement. You can access this online by creating a “my Social Security” account on the SSA’s website. The statement summarizes your earnings history and provides an estimate of your future Social Security benefits.
Common Issues
Many people face issues with their Social Security records due to errors or omissions. Common problems include:
- Employers failing to report earnings to the SSA.
- Inaccurate recording of wages.
- Missing years of earnings in the record.
These mistakes can happen for various reasons, including administrative errors or incorrect information provided by employers.
Steps to Correct Your Earnings Record
- Collect Documentation: Gather any relevant documents, such as W-2s, 1099 forms, or pay stubs, that can serve as evidence of your earnings. These documents are vital when disputing errors.
- Contact the Social Security Administration: If you notice discrepancies, contact the SSA immediately. You can reach them by phone at 1-800-772-1213 or visit your local Social Security office.
- Submit Proof of Earnings: Provide the SSA with copies of your documentation to support your claim. The more thorough your evidence, the quicker your correction can be processed.
- Wait for Your Statement Correction: Once you’ve submitted your request, the correction process can take anywhere from 10 to 90 days. The timeline depends on the complexity of the case and the availability of records.
High Earners Can’t Include All Their Earnings
It’s important for high earners to note that there is a limit on the amount of earnings that can be counted toward Social Security benefits. Each year, there is a maximum taxable earnings cap, which means that any income above this threshold will not be included in your Social Security calculations.
What if My Employer Did Not Report My Earnings to Social Security?
If your employer didn’t report your earnings, you could face significant reductions in your retirement benefits. In such cases, it’s critical to gather as much evidence as possible and contact the SSA to rectify the situation.
Routine checks of your Social Security earnings record are vital to mitigate errors and ensure you receive the benefits you’ve earned. By actively managing your records and addressing discrepancies promptly, you can secure a more stable retirement. For further assistance, consider consulting a financial advisor who specializes in Social Security benefits.
Scott Rosen is the Executive Vice-President and Research Champion of the IFW. Scott is a 30-year veteran of the financial services industry.
