Social Security Administration Makes Big Mistakes – Chicago Tribune

Social Security Administration Makes Big Mistakes – Chicago Tribune
Social Security Administration Makes Big Mistakes – Chicago Tribune

The Social Security Administration makes mistakes. Sometimes large. If social security has miscalculated and underpaid you for many years, you may never find out. But these days many people get letters from the social security saying that they have been overpaid for many years.

And the social security requires you to return such overpayments even if it is responsible for the error.

In many cases, these long-term errors in social security calculations add up to enormous amounts. Consider, for example, “Dana,” who recently posted this question on my blog at

“In May 2021, I received a letter from Social Security stating that I owe $88,734 because I was not entitled to my husband’s benefits because I am collecting a pension. I went through the whole process with the social security (administration), brought all the documents that they needed and nothing was ever told to me by them that I was not able to collect. I appealed but never heard from them until now!

“I’m 73 and had a heart attack with a triple bypass done! I don’t want to lose my house! I have all the documents since this started almost two years ago. With COVID-19 they would never come back to me and offices were always closed. Now they are threatening me. Please help!”

Her question shocked me, and I turned to famed economist Laurence Kotlikoff, creator of the calculator and co-author of the bestseller “Get What’s Yours: The Secrets to Maxing Out Your Social Security.”

According to Kotlikoff, Dana is not alone. He told me:

“I receive emails on a routine basis from people who out of the blue received a letter from Social Security demanding, without any clear explanation, that they repay previously paid benefits within 30 days! Very young children, elderly widows, pensioners, spouses, divorcees, disabled workers – you name it. The bills can be in the thousands, tens of thousands and even hundreds of thousands.

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“A disabled lady was claimed back for over $300,000 for a mistake that Social Security admitted in writing was theirs! Disabled, she wrote a successful book. The woman’s “crime” was receiving royalties on a book she wrote that Social Security told her, for ten consecutive years, would not reduce her disability benefits — because royalties are not earned income.

“When I asked the social security for an accounting of how much money they claim back, I was referred to their 182-page annual report. Digging into the balance sheet, I found $8.6 billion in “claims” that “mainly consist of money due to the SSA from Social Security (and disability) recipients who received benefits beyond their entitlement.

“Even worse, if you don’t pay back your share of the $8.6 billion in Social Security defaults, they’ll almost always stop sending you a dime until you’ve paid back what they say you owe.”

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Kotlikoff has been waging a crusade against social security failures for years. Clawbacks are not the only abuse of power by Social Security. He has written about the attempts to “bribe people to forgo earning delayed retirement credits and withdraw their retirement benefits sooner than they should.” Or what he calls “widow fraud” where Social Security simultaneously enrolls the widow(s) for both the retirement and the widow’s benefit when they do, can only cost the claimant money, potentially hundreds of thousands of dollars.

Kotlikoff has even offered his online calculator to the government so Social Security representatives can use its complex modeling capabilities to provide the right advice.

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His earlier public complaints, based on a Social Security whistleblower, were the impetus for the 2018 Social Security Inspector General report, which called on the Social Security Administration to end its abuse and compensate victims. Nothing has been done, he states.

So, Larry Kotlikoff and I are teaming up to help people deal with this one problem – Social Security’s refunds because of the agency’s own mistakes. If you have had benefits returned as a result of a Social Security error, please post a brief description on my AskTerry blog at, including your name, email and phone number. (Do not specify your social security number.)

I will not answer publicly. But I will collect these complaints and pass them on to Kotlikoff, who promises to take them to the highest authorities.

Maybe we can make a difference this time. That’s the wild truth.

(Terry Savage is a registered investment advisor and author of four best-selling books, including “The Savage Truth on Money.” Terry answers questions on her blog at

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