An analysis conducted by the U.S. Government Accountability Agency (GAO) found that Social Security applicants were given incomplete, not enough and, in a few instances, incorrect information.
An analysis conducted by the U.S. Government Accountability Agency (GAO) found that Social Security applicants were given incomplete, not enough and, in a few instances, incorrect information. Among the issues found by the GAO were:
Insufficient Guidance on How Claiming Age Affects Benefits: The SSA’s Program Operations Manual System (POMS) states that claimants should be advised of the opportunity to receive higher benefits by delaying. POMS also calls for providing at least three benefit amounts—the benefit at the claiming month, at full retirement age (FRA) and at age 70. The online claims process provides this information, but in half of the in-person interviews observed by the GAO, the information was either not presented or was incompletely presented.
Failure to Explain Retroactive Benefits: Up to six months of benefits can be claimed retroactively under certain circumstances, but doing so permanently reduces the monthly benefit. Claims specialists only offered this option in 10 of 30 observed interviews, and only one specialist explained the permanent decrease in benefits. The online application process asks qualifying claimants to explain why they didn’t take the retroactive benefits, which could lead applicants to incorrectly think they made a mistake.
Not Discussing the Impact of Lifetime Earnings: SSA guidelines do not instruct claims specialists to discuss how working longer can potentially increase benefits by boosting lifetime earnings. Similarly, the online application process does not explain that benefits are based on the highest 35 years of earnings.
Inconsistent Explanations of the Earnings Guidance Test: Most claims specialists correctly told applicants that benefits would be reduced if wages exceeded the earnings test. Fewer than half further explained that any withheld benefits would be recalculated and higher benefits would be paid after the applicant reaches full retirement age. Some specialists even gave incorrect information.
Breakeven Ages Given: POMS instructs claims specialists not to provide a breakeven age, the age at which cumulative benefits exceed the amount that could have been received by claiming earlier. Yet the GAO observed specialists giving breakeven ages and even personal opinions.
Source: “Social Security: Providing More Information During Claims Process Would Help Individuals Making Decisions About Retirement Benefits,” Charles Jeszeck, GAO, September 14, 2016.
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A Thompson from MI posted over 9 years ago:
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