By Rebecca Jacobson
Those with summer birthdays will find an important piece of mail missing from their mailboxes. On March 31, the Social Security Administration abruptly decided to stop sending its yearly earnings statements.
Apart from a post on its website, and Commissioner Michael Astrue’s testimony before the Senate on March 9, the organization made no other announcement that it would be discontinuing the statements.
Kia Price, public relations office for the SSA, said the decision was made due to budget concerns. The SSA will save $30 million this year by discontinuing the statements, and estimates it will save $60 million in fiscal year 2012.
This all came as a surprise to James Watkins, who waited this April for his earnings statement to show up in the mail. The SSA has sent out yearly earnings statements automatically to everyone over the age of 25 approximately three months before their birthday since 1995. The statements contain the worker’s earnings record, estimated benefits, and yearly taxable earnings. It allows workers to verify that their wages are reported correctly.
Watkins is 51 years old, and like many Americans, he used the yearly statements as a retirement planning guide.
“They let me gauge how much money I need to make each year…let’s say one year I make $10,000 and the next year I make $30,000,” he said. “My monthly payments change depending on how much I make. I’ve been monitoring those since 1995 and now I have no way to do that.”
The SSA does have an online tool that is intended to provide much of the same information. But the online estimator tool can be difficult to navigate, even if you know how to find the information. People without Internet access or computer skills, especially those in Watkins’ age bracket, might not know that the information is available online in the first place.
The online estimator tool is also only intended to provide the estimated monthly benefits that one can expect upon retirement. It cannot give out more than one year’s earnings information, nor can it provide a total amount paid to Social Security. It also doesn’t provide users with an amount earned.
Price says there is a long-term plan for the public to access a full statement online, but currently that is not possible. Security is a major concern when it comes to posting personal earnings information online.
David Certner, legislative policy director at AARP, said that even if the online tools were as robust as they could be, they are still no substitute for a written statement. He said Social Security is still the largest income provider for retirees, and that isn’t likely to change. In fact, he estimates it will become even more important, especially to those in their 50s and 60s who have recently lost value in their homes or lost their savings in the recession. People are living longer, pensions are weaker, and that earnings statement is still the best way to ensure the correct information gets into people’s hands.
“These are people on the brink of retirement. The average age to take Social Security is 62, so that doesn’t give a lot of lead time for people,” Certner said. “This is an important annual statement, and an important contribution people are making.”
While calling the SSA to request a copy of your earnings record is an option, it can also be complicated, taking a lot more time than even the online tool requires. For now, Certner says AARP can only urge people to make phone calls and use as much of the online information as possible to track their earnings and estimated monthly benefits.
Early in fiscal year 2012 the SSA does hope to resume sending statements to people age 60 and over who are not currently receiving benefits. AARP hopes to work with the administration to expand that age bracket, but for now there are no plans to resume statements for any other group, which makes Watkins nervous.
“That’s nine years of not knowing for me,” he says. “That’s scary.”