- In October, SSA will begin to mail annual,
individualized Social Security Statements to 125 million workers
age 25 and older who are not receiving Social Security benefits.
- SSA is required by the Omnibus Budget
Reconciliation Act (OBRA) of 1989, modified by OBRA 1990, to send
HOW THE MAILINGS WILL WORK
- The statements are available in English
and, upon request, Spanish. (A Spanish version of the statement
will automatically be mailed to residents of Puerto Rico.)
- The statements will be mailed about 3
months before the worker's birth month. The statement for a working
spouse will be mailed about 3 months before the spouse's birth
- Mailings will be staggered over a year-long
- Every workday statements will be mailed
to approximately 500,000 people.
- A total of about 10 million mailings
will be delivered each month.
- The Statements cost about 56 cents to
produce and mail, for a total cost of approximately $70 million.
WHAT'S IN THE STATEMENT
- The statement contains:
- An estimate of the monthly retirement
benefit that the worker would receive at age 62, full retirement
age and age 70;
- A projection of the amount of monthly
disability benefit the worker could be entitled to should
he/she become disabled; and
- An estimate of the monthly benefit
that the worker's family could receive should the worker die.
- How the benefit projections are
- First SSA checks to see that
the worker has worked enough over the years to qualify
for a Social Security benefit. If the worker does
not currently qualify for any type of benefit, he/she
is informed that they may receive an estimate in the
future if they continue to work.
- SSA estimates the amount of
each benefit using the worker's average earnings over
his/her working lifetime. For earnings for the current
year and for years up to retirement, SSA assumes the
worker will continue to work and make about the same
as the latest earnings shown on the record.
- The current year's benefit
formula (methodology) is used in the benefit computations.
- The statement also contains:
- An annual breakdown of the worker's
earnings to date, and
- A total of the Social Security taxes
paid by the worker and his/her employer over the individual's
- SSA recently redesigned the statement
to make it more user-friendly.
- The language was simplified.
- The number of pages was reduced from
six to four.
- The redesigned statement was tested
with focus groups and through a mail survey of 16,000 workers.
- SSA prepared for the mandated mailing
by automatically sending statements to individuals in select age
categories beginning in 1995.
- From 1995 to date, SSA mailed nearly
73 million statements to individuals age 40 and older.
- Workers have been able to request a statement
- SSA has responded to approximately
37 million requests for statements.
THE IMPORTANCE OF THE STATEMENT
- The Social Security Statements are a valuable
financial planning tool.
- They provide workers an estimate of
their retirement, disability and survivors' benefits.
- They provide workers an easy way to
determine whether their earnings are accurately posted on
their Social Security records.
- Social Security benefits are based
on an individual's life-long wage record.
- Social Security is more than just a retirement
program, it is America's family protection plan.
- One out of every three Social Security
beneficiaries is not a retiree but a disabled worker, or a
member of a disabled worker's family, or a survivor of a worker
who has died.
- Almost 3 in 10 of today's 20 year-olds
will become disabled before reaching age 67.
- Social Security provides disability
coverage for a worker with a family equivalent to about a
$233,000 disability policy.
- One in 6 Americans will die before
reaching age 67.
- Social Security provides survivors
protection equivalent to about a $354,000 life insurance policy.
- The results of a recent Gallup survey,
undertaken at the request of SSA, revealed that individuals who
had received a statement:
- Had a significantly increased basic
understanding of Social Security, and
- An increased understanding of some
important basic features of Social Security:
- The amount of Social Security benefits
depends on how much people earned;
- Social Security pays benefits to workers
who become disabled;
- Social Security provides benefits
to dependents of workers who die; and
Social Security was designed only to provide
part of total retirement income.