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Although Social Security benefits are a major part of retirement planning, since the Social Security Administration stopped mailing statements to workers last year, most planners have been limited in their ability to get updated Social Security information for clients - especially new clients who may not have a prior benefits estimate, and/or who may have never previously reviewed their earnings record. Fortunately, earlier this month the Social Security Administration launched a new online platform allowing anyone to access their own Social Security benefits estimate and earnings record. In response, many planners are now starting to walk clients through the process of claiming their online Social Security account - which can be done on the spot, in the planner's office, in less than 5 minutes! - and reviewing the benefits estimate and earnings record as a part of their new or existing client meetings!

The inspiration for today's blog post was the recent announcement by the Social Security Administration that Social Security statements - including estimated benefits, and earnings history - are now available online through the website by creating a MySocialSecurity account.

Distributing Social Security Statements

Since 1999, the Social Security Administration has mailed annual statements to workers of their estimated Social Security benefits (from 1995 to 1999 the mailings only went to those over age 60), as part of a provision under the Omnibus Budget Reconciliation Act of 1989 intended to help educate workers about their benefits and allow them to review the accuracy of their earnings record for calculating benefits. Last year, however, in a somewhat controversial change, the Social Security Administration stopped mailing annual Social Security statements to workers, in an effort to save approximately $70 million/year in printing and mailing costs, leaving workers without any reporting about their benefits unless they proactively contacted the Social Security Administration to request.

However, even at the time the Social Security Administration ceased mailing statements, it indicated that it was working on an online option for workers to access information about their expected benefits and to review their earnings record, and the site is now finally live. The new online launch has not been without controversy, though, as some point out that there is still a "digital divide" in much of American, such that workers in poorer or more rural areas may have more limited access to the internet and consequently may be unable to access their statements. In addition, the original intent of the statement legislation was not just to make statements available, but to proactively send them to workers to help educate regarding benefits, which isn't accomplished by the current online offering.

Getting Benefits Information (Online)

The process for getting Social Security benefits information online is remarkably easy and straightforward. The client starts by clicking the "Create an Account" button on the MySocialSecurity site (which redirects the client to a secure site for login and/or account creation).

After entering some basic personal information - including name, address, and Social Security number - the system asks several personal questions, drawn from credit history (e.g., what company holds the mortgage you took out in 200X, what street did you live on in 199X, etc.), to verify the individual at the keyboard really is the right person. Assuming the security questions are answered correctly, the client is then prompted to create a username and password (with some very stringent requirements), and to complete some new security questions that will be used in the future to verify the account owner if the username/password are lost.

Once the account has been created, the client can see the online information in a series of simple screens, including estimated benefits for retirement, disability, and survivors, and the client's historical earnings record for Social Security and Medicare earnings (including an estimate of total Social Security and Medicare taxes paid over the years). Notably, if there's an error in the earnings record, it's still necessary to call or write the Social Security Administration to fix the problem; the online service only reports information out.

Security Concerns

Some clients may have security concerns regarding establishing their MySocialSecurity account, and/or doing so in the planner's office. A few safety precautions and a clear understanding of what MySocialSecurity account does - and does not - offer should help alleviate most concerns. Some tips include:

- Clear the cache and cookies of the web browser you use with the client to access the site before and after going to create and log in to the account (or simply let the client use his/her own computer or mobile device). This ensures that no information from prior computer users and/or other clients unintentionally carries over to the current client trying to log in. It also ensures that you don't leave any identifying information of the client on the computer afterwards. Many internet browsers also offer a "private browsing" feature that automatically does NOT store any cookies or cached information, and/or automatically clears them after each session, to ensure client information isn't retained.

- The MySocialSecurity account pages are available and ready/waiting to be claimed. Thus, clients who are concerned about someone accessing their account would be advised not to ignore it, but to proactively claim their account with their Social Security number, and then take advantage of the security settings available through the site - from setting your own username, password, and security questions, to requesting the system send you a text message to a specified cell phone every time anyone logs into your account so you'll know immediately if your account has been breached.

- The MySocialSecurity account page is at the end of the day, only a reporting page for the client's benefits information and earnings record. There is nothing tied to the service that would allow someone to change any benefits elections or personal details of the client. The online service is merely an electronic version of the statement that was previously sent in the mail (and/or which could have been stolen from the client's mailbox).

- Clients fearing identity theft should have little to worry about by establishing a MySocialSecurity account. The reality is that all of the private and personal client information isn't contained on the website, it's actually used to access the website in the first place. Which means anyone who tried to "hack" into the client's account would already have all the information - including the client's name, address, and Social Security number - and wouldn't benefit by trying to log in. In fact, once the client's Social Security number is entered once to establish the account, it's never seen again. The login pages of the MySocialSecurity website don't even display the client's Social Security number; just the estimated benefits and reported earnings record.

Helping Clients Claim Their Account

Because of the relative ease and speed of creating a MySocialSecurity account, many planners are encouraging clients to establish their account during current and upcoming plan review meetings. The whole process takes less than 5 minutes (done separately for each member of a couple), and ensures that the client claims the online account before someone else does (although as noted above, there isn't any identify-theft-related information in the website that someone wouldn't already have just to create the account in the first place!).

In addition to helping the client get his/her own information, walking clients through claiming their account can also be a nice opportunity for the planner to obtain the latest Social Security estimate for the client, and to jointly review the client's earnings record to verify the information is accurate.

So what do you think? Have you checked out the MySocialSecurity website with your clients yet? Have you walked a client through the process? Have you claimed your own account yet? Do you think this is a good thing to do in a client meeting?

  • Bill Meyer

    Regarding your questions, yes I think this is a great new resource. I went through the process myself and it took less than 5 minutes.

    However, it is critical advisors understand this is only a resource to help your clients see their benefits and review their earnings history. This is NOT a tool to help you create a “claiming strategy.”

    As most advisors know now the Social Security Administration does not provide “advice” or let its agents give advice. There is a huge opportunity for advisors to devise a smart claiming strategy that can garner thousands of more dollars for individuals.

    Advisors need to learn these techniques, but this problem is complex and requires software. Here our technology that advisors can leverage our book and research published in the Journal of Financial Planning.

    We were just reviewed and recommended by Joel Bruckenstein, expert on advisor technology, in Financial Advisor Magazine.

  • Marc Freedman

    Michael –
    The new online Social Security tool was the topic of our radio show this week.

    We have registered for the program and we’ve been helping clients register when they visit our office. I’ve yet to have ANYONE worry about privacy issues.

    I’ve got to say the hardest part of signing up, is finding a compliant username and password. Unlike most online programs that allow you to use your email address or parts of your name; the system WILL NOT allow you to use any part of your name in either the Username or Password.

    One of our Value Adds is that our clients are counting on us to retain that info on their behalf, as they know that they will either forget it or lose it before they even get home.

  • Cathy Curtis

    Yes! I was with a client who didn’t know where her statement was this week. I figured I would like on to the SSA website and use the calculator to get an estimate. I was thrilled to see that you can get the info online now. My client signed up right there….lot’s of security loops to get through and takes a while to sign up because of that, but patience was rewarded – we got the information we needed!

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Michael E. Kitces

I write about financial planning strategies and practice management ideas, and have created several businesses to help people implement them.

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