The amount of your Social Security benefits is based on how much you make throughout the time you work. Specifically, you get benefits equal to a percentage of your average wages in the 35 years your earnings were highest, after wages are adjusted for inflation.
Since benefits are based on your income, it's important to make sure the Social Security Administration has an accurate record of what you've earned. To do this, you'll need to check your Social Security earnings statement.
How to check your Social Security earnings statement
Checking your record of earnings with the SSA is easy. If you're 18 or over, you can create an account with www.socialsecurity.gov/myaccount. You'll need a few pieces of identifying information, including:
- Your email address
- Your Social Security number
- Your mailing address in the United States
Next, log into the account you've created and click the option on the main page to "View earnings record."
When you choose to view your record, you'll see a table showing the work year, amount of taxed Social Security earnings, and amount of taxed Medicare earnings for each year you had countable income.
There are different columns for Social Security and Medicare earnings because you pay Medicare taxes on the entire amount of money you earn, but you pay Social Security tax only on income up to the annual wage base limit. This limit changes annually and, when benefits are calculated, only income up to the taxable limit is factored in. The limit is pretty high -- it's $137,700 in 2020 -- and unless your income exceeds it, the earnings in both columns should be the same.
Why is it important to check your Social Security earnings record?
You should check your earnings record at least once per year to make sure your earnings have been properly reported to the SSA.
If your employer didn't report your income properly or reported using the wrong name or Social Security number, you may not have received credit for all you made. If you changed your name after marriage or divorce and didn't report this to the SSA, you may also have an incorrect record.
If there's a problem, you need to contact the SSA to correct it -- and provide documentation including tax returns, W-2s, or pay stubs. If you've gone years between checking your earnings and you notice a mistake, you may not have these old documents any more and fixing your record could become more difficult.
If you don't get credit for the full amount of wages you earned, your Social Security benefits will be smaller as a result of it. And if money was taken directly out of your paycheck to cover Social Security taxes (as it usually is for most people), you'd have paid taxes for benefits you don't receive.
Don't leave your benefits unclaimed
Chances are good Social Security is going to be an important source of funds when you retire. You don't want your checks to be reduced because your earnings record wasn't correct. Create your account and check your earnings record today if you haven't done so recently, so you can make sure you're getting the full amount of retirement benefits you deserve.