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Online Social Security statements: Patience advised

(MoneyWatch) The Social Security Administration recently announced they're now providing access to online statements that show estimates of your Social Security benefits, as well as your earnings history. Last year, as a cost-savings measure, they discontinued mailing paper statements to everyone who has ever contributed to Social Security. In February of this year, they resumed mailing paper statements to workers age 60 and older.

To see my online statement -- and test how easy the new system is -- I went to the Social Security website and tried setting up an account. But the site wouldn't let me set up an account in spite of making several attempts. It asked for my complete name, Social Security number, date of birth, address and phone number; I tried every possible combination of home phone numbers, cell phone numbers, and addresses I've used in the past 15 years, but no luck. So I called a representative at Social Security, who told me that for security purposes, the new system is very sensitive when matching up the information I input regarding my address and phone number with the information that's in the database.

I was told to go into the nearest Social Security office to clear things up. No way - I just don't have that kind of time. I was able to place an order online for a paper statement to be mailed to my house, which should arrive in four to six weeks. So much for saving money!

What I was able to do, however, was to use the online benefits estimator to generate the same estimates I could have seen in the online benefits statements that are based on my earnings history. Apparently this system isn't as sensitive to security measures as the online statement system. One problem is that this benefit estimator won't let me confirm my earnings history, while the paper statements and online statements do let me confirm this history.

I also asked my wife to set up an online account, which she was able to do after a few attempts. After passing the first set of questions described above, she was then asked a few questions about her credit history to verify her identity. Finally, she was able to see her benefit estimates and confirm her earnings history. It showed her the monthly benefits payable at her ages 66, 70, and 62 -- in that order. I like this feature -- it suggests that starting benefits at age 66 is better than starting at age 62.

If she starts benefits at age 62 -- the mistake that half of all Americans make -- she'd get the lowest monthly benefit. If she waits until age 66, she'll increase her monthly benefit by about 39 percent, and if she waits until age 70, she'll increase her monthly benefit by about 87 percent.

She expects to live a long time, since she takes care of her health and has long-lived older relatives. So, she's planning to wait until age 70 to start her own benefits. But we plan to use the "file and suspend" maneuver to start her spousal benefits at age 66.

I encourage you to take the time -- and have the patience -- to learn about your estimated Social Security benefits, either by setting up an account online, using the online benefits estimator, requesting a paper statement be mailed to your house, or, if you're age 60 or older, waiting for the paper statement in the mail. Be sure to verify your earnings history, too, to correct any errors that may have been made.

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For many people, Social Security benefits will be the primary source of their lifetime retirement income. It's well worth your time learning how to maximize your lifetime payouts.

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