Understanding your Social Security Statement

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In the past, Social Security statements were mailed to beneficiaries every few years, giving them updates on their benefits. Now, statements are updated yearly, and beneficiaries can access them at any time online.

Your Social Security statement provides valuable information, especially when it comes to making decisions regarding retirement.

Social Security: Understanding Your Statement

Social Security statements are the most valuable document when it comes to understanding your benefit. Hans goes over his statement and the important information you can find on yours!

Where do I get my Social Security statement?

When planning for retirement, you will want up-to-date information. You can get this by downloading your most recent Social Security statement online.

The website to get your Social Security statement is ssa.gov/myaccount/. If you have not already made an account, you will need to sign up.

Signing up for a my Social Security account takes a few minutes.You will need a valid email address, a Social Security number, and a U.S. mailing address.

You will get asked a few questions based on your personal information to verify your identity and then be texted or emailed a security code.

If you have already signed up for an account, you will just need to log in to view your most recent Social Security statement.

Listen to learn more about your Social Security statement:

What is included in my Social Security statement?

If you have ever received a Social Security statement in the mail, the information available online is the same, just updated.

Your Social Security statement will include:

  • Estimate of Social Security benefits at Full Retirement Age
    Full Retirement Age (FRA) is the age you are eligible for your full Social Security benefit. FRA is based on the year you were born. For those born in 1960 or later, your FRA is age 67. Your statement will give you an estimate of what your monthly Social Security payment would be at your specific full retirement age.
  • Estimate of Social Security benefits at age 70
    You can delay Social Security up to age 70. Every month you delay, your benefit grows. Your Social Security statement will give you an estimate of what your monthly payment would be if you delayed starting your benefit until age 70.
  • Estimate of Social Security benefits at age 62
    The earliest you can start your Social Security is age 62 (unless you are a widow or widower). If you start your benefit at any point before your full retirement age, your benefit will be reduced. Your statement will give you an estimate of what your reduced payment would be if you started Social Security at age 62.
  • Estimate of Social Security Disability benefits
    If you have earned enough credits to qualify for disability benefits, your Social Security statement will give you an estimate of what your payment would be if you were to become disabled.
  • Estimate of Social Security family survivor benefits
    If you have earned enough credits to qualify for survivors benefits, certain members of your family might be eligible for payments if you die. Your statement will give you an estimate of what a child, a spouse caring for a child, and a spouse at their full retirement age would receive in benefits in this situation. There is a total family benefit limit that is also outlined on your statement.
  • Taxes paid towards Social Security and Medicare
    Your Social Security statement includes your earning record for every year you’ve worked. It lists your taxed Social Security earnings as well as taxed Medicare earnings. Your statement will also show you an estimate of taxes both you and your employers paid for Social Security and Medicare.

All Social Security statements also have a section titled “Some Facts about Social Security.” In this section, it talks about how Medicare and Social Security work together. It also states “Medicare does not pay for long-term care, so you may want to consider options for private insurance.”

This is the government telling you they are not going to pay for long term care, so you need a plan to pay for these yourself. They recommend looking into long term care insurance options.

 
 

Why is my Social Security statement important?

On the first page of your Social Security statement, it says “Social Security benefits are not intended to be your only source of income when you retire. On average, Social Security will replace about 40 percent of your annual pre-retirement earnings. You will need other savings, investments, pensions, or retirement accounts to live comfortably when you retire.”

Social Security creates the foundation for retirement planning. Your Social Security statement provides crucial information to help make your decision about when to start your check. Starting your Social Security at the right time can be the difference between tens of thousands of dollars over your lifetime, as well as your spouse’s lifetime.

Social Security creates the foundation of your retirement income, but it is not enough for retirees to live off of. Figuring out your Social Security benefit is the first step in creating an income in retirement. Cardinal can not only help you with Social Security, but also with creating a supplementary income from your savings, investments, and retirement accounts.

 

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Understanding your Social Security Statement

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Understanding the Upcoming 2026 Income Tax Increase: What You Need to Know

A Brief History of the Tax Cuts and Jobs Act (TCJA)

In today’s Cardinal lesson, we’re discussing the significant changes coming to income tax rates in 2026. This isn’t a proposal but a law already set in motion. The Tax Cuts and Jobs Act (TCJA), passed in 2017 and effective from January 1, 2018, brought about substantial reductions in income taxes. However, these reductions were only funded for eight years, meaning they will expire at the end of 2025.

What Changes to Expect in 2026

As of January 1, 2026, the tax rates will revert to their 2017 levels, adjusted for inflation. Key changes include:

  • The 12% bracket will increase to 15%.
  • The 22% bracket will rise to 25%.
  • The top rate of 37% will revert to 39.6%.

Not Just a Proposal

It’s crucial to understand that this change is already the law. Many people mistakenly believe that the tax rate increases are still under discussion. However, unless Congress enacts new legislation, these higher rates will take effect as scheduled.

Implications for Your Financial Planning

Impact on IRAs and 401(k)s

With the current lower tax rates, now is the time to consider strategies like Roth conversions. By converting funds from a traditional IRA to a Roth IRA now, you can potentially save a significant amount in taxes over the long term.

Why Planning Ahead is Crucial

For individuals with substantial retirement savings, understanding these changes is vital for effective tax planning. The window to take advantage of the current lower tax rates is closing, and planning ahead can make a significant difference.

Case Studies and Planning Opportunities

Hans Scheil and Tom Griffith discuss specific case studies and planning strategies in our latest video. These examples illustrate how different scenarios can be managed effectively:

  • Case Study 1: A married couple with an adjusted gross income of $150,000 in 2024 can convert part of their IRA to a Roth IRA, taking advantage of the lower current tax rates.
  • Case Study 2: High-net-worth individuals with large IRAs can save substantial amounts in taxes by planning conversions over the next two years.

Estate Tax Considerations

The TCJA also doubled the estate tax exemption, which will revert in 2026. This change can significantly impact high-net-worth individuals, making estate planning more crucial than ever.

Action Steps to Take Now

  • Review Your Current Tax Situation: Analyze how the upcoming changes will affect your finances.
  • Consider Roth Conversions: Take advantage of the lower tax rates before they expire.
  • Plan for Estate Taxes: Assess your estate plans in light of the changing exemptions.

Conclusion

The changes coming in 2026 are significant, but with proper planning and informed decision-making, you can navigate these changes effectively. Watch our video for more detailed insights and personalized advice.

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