Associated Press: Those yearly earnings statements that Social Security mails out — here’s what you’d get if you are disabled, retired at 62, at 66, at 70 — will soon stop arriving in workers’ mailboxes. It’s an effort to save money and steer more people to the agency’s website.

The government is working to provide the statements online by the end of the year, if it can resolve security issues, Social Security Commissioner Michael Astrue said. If that fails, the agency will resume the paper statements, which cost $70 million a year to mail, he said.

“We’ll provide it, we expect, one way or another, before the end of the calendar year,” Astrue told The Associated Press. “We’re just right now trying to figure out the most cost-effective and convenient way to provide that to the American public.”

The statements, mailed to 150 million people each year, project future benefit payments, helping workers plan for retirement.

The decision to suspend the mailings was unrelated to the talk of a possible partial government shutdown. It was, however, related to the agency’s operating budget, which has essentially been frozen at 2010 levels — minus about $350 million in economic stimulus money the agency had been using to handle claims.

Claims for retirement and disability benefits are up significantly since the nation’s economy soured in 2008. About 2.7 million people applied for retirement benefits last year, a 17 percent increase from 2008, according to agency statistics. About 3.2 million people applied for disability benefits last year, a 23 percent increase.

Since the 1980s, Social Security statements have been mailed each year to workers older than 25. They include a history of taxable earnings for each year — so people can check for mistakes — as well as the total amount of Social Security and Medicare taxes paid over the lifetime of the worker.

The statements provide estimates of monthly benefits, based on current earnings and when a worker plans to retire. Workers can claim early retirement benefits starting at age 62. Full benefits are available at age 66, a threshold that is gradually increasing to 67 for people born in 1960 or later.

The statements are mailed throughout the year, so many people have already received them this year. Tens of millions have not.

The agency does offer a benefits estimator on its website that Astrue said can be even more helpful than the annual Social Security statements. Workers can enter their Social Security numbers on the website and get estimates of future benefits, depending on when they plan to retire.

The website, however, does not provide the detailed earnings and payroll tax history that workers had been receiving in the mail each year.

Ending the statements is part of a trend in government to conduct more of its business electronically. Social Security already mails out few paper checks. About 88 percent of beneficiaries have their payments deposited directly into their bank accounts.

About 41 percent of applications for retirement benefits come in online, Astrue said. About 44 percent of Medicare applications are done online. In all, the agency’s website attracts about 11 million visitors each month.

A little-known strategy that allows Social Security recipients to boost their income by repaying retirement benefits received in earlier years and then claiming a bigger monthly retirement check based on their greater age may soon disappear. The Social Security Administration (SSA) is moving to eliminate the do-over strategy. If the agency gets its way, the rule could take effect within months. If you or someone you know might benefit from the payback strategy, now is the time to consider it and come to a decision. Putting it off could mean letting the government make the decision for you — by eliminating the opportunity. Retirees can collect Social Security benefits as early as age 62, but monthly payments are reduced by 25 percent compared with what they would be if claimed at full retirement age, which is 66 for those who claim benefits this year. Those who are willing to wait past age 66 can boost their benefits by 8 percent for every year they delay, up to age 70, increasing annual benefits to 132 percent of their base amount. In 2007, about 500 people — out of more than 37 million retirees and their dependents receiving benefits — took advantage of the payback option. By 2009, the number had nearly doubled as more retirees learned how they could repay their benefits, interest- and penalty-free, and restart them at a higher level. As a bonus, those who repay benefits can claim a tax credit or a tax deduction — whichever results in a bigger tax break — for any income taxes paid on the benefits as they received them.

Source: Washington Post (August 29, 2010)

Republican-held Congress might look to raise the retirement age to 70, House Minority Leader John Boehner (R-Ohio) suggested Monday June 28. Boehner, the top Republican lawmaker in the House, said raising the retirement age by five years, indexing benefits to the rate of inflation and means-testing benefits would make the massive entitlement program more solvent. “We’re all living a lot longer than anyone ever expected,” Boehner said in a meeting with the editors of the Pittsburgh Tribune-Review. “And I think that raising the retirement age — going out 20 years, so you’re not affecting anyone close to retirement — and eventually getting the retirement age to 70 is a step that needs to be taken.” The GOP leader said Social Security was the most important entitlement to reform, though he also pledged Republicans would bring legislation to the floor to repeal and replace the health care reforms passed earlier this year if the GOP wins back control of the House this fall.

Source: The Hill (June 29, 2010)

I have received a question regarding whether or not a person is entitled to retirement benefits on their ex-spouse’s Social Security record. The law on this is as follows:

An unmarried divorced spouse is entitled to benefits starting at age 62 if they had been married for at least 10 years and there ex- husband or ex wife is at least 62 years old (retired and receiving benefits or not) or are receiving Social Security Disability benefits.

A divorced spouse cannot receive this benefit if they have remarried unless the marriage is to a person already receiving benefits as a widow, widower, parent, or disabled adult child.

If the ex-spouse is 62 but not retired, then the divorce must have occurred at least two years before the divorced spouse can receive the benefits. If the divorced spouse was entitled before the divorce to benefits, there is no waiting period.

As for the amount of benefits that can be received:

A divorced spouse at full retirement age is entitled to 50% of their ex-spouse’s retirement benefit.

At age 62 the divorced spouse is entitled to between 32 1/2 % and 35 5/6 % of their ex-spouse’s retirement benefit depending on the divorced spouse’s full retirement age.

If the divorced spouse is also insured for their own retirement benefit, she/he would only receive whatever amount from their ex-spouse that is necessary to make up the difference.

Social Security has unveiled its newest online service – an application for Medicare benefits.

This new online application, which takes less than 10 minutes to complete, is for people reaching the Medicare eligibility age of 65 who want to delay filing for Social Security retirement benefits.

Currently about a half million Americans enroll in Medicare each year without applying for monthly benefits.

“Social Security’s online services are the best in all of government and exceed the top private sector companies in customer satisfaction,” said Michael J. Astrue, commissioner of Social Security.

“The new Medicare application is a welcome addition to our suite of online services and will make it easier than ever to sign up for Medicare.”

To apply online for Medicare, go to www.socialsecurity.gov and choose Retirement/Medicare under the header, “Click Below To Apply For.”

You will be asked a brief series of questions. If you have a question or need additional information, there are convenient “more info” links. When you’re done, just click the “Sign Now” button to submit the application. There are no paper forms to sign, and usually no additional documents are required.

If more information is needed, Social Security will contact you by phone or letter.

For a variety of reasons, more and more Americans are choosing to delay receiving Social Security retirement benefits past the Medicare eligibility age of 65.

Although the age to collect full retirement benefits used to be age 65, it is now age 66 for individuals just becoming eligible for retirement benefits and will eventually become age 67. Benefits can be increased by up to 32 percent if someone delays receiving them until age 70.