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Include SS in Retirement Planning?
Old 07-19-2012, 10:18 AM   #1
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Include SS in Retirement Planning?

Am certain that the subject is covered here (somewhere)... but going through tens of thousands of posts is a bit daunting.

So here's the question:
Most of the websites that cover the "dollars needed to retire" ignore Social Security, at the end of the calculation. Why? Perhaps because this amount is considered too small to be bothered with? In my case, it's important....

The problem that I see is, when trying to decide whether or not to retire, that amount has to be added in, making the calculation more difficult, especially long term, when inflation has to be calculated.

For a couple. the annual SS can be a substantial supplement, or in my case, a major part of base planning.

Thoughts?
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Old 07-19-2012, 10:21 AM   #2
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The better online calculators included SS.

You can always back the income from SS out from your need. Then even the simple calculators can predict what kind of cashflow a nestegg can generate.
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Old 07-19-2012, 11:15 AM   #3
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I found most retirement calculators include SS--maybe those that do not include it are attracting more of a global audience and trying to keep it simple.

Here are several that let you factor SS into the results:

SmartMoney Retirement Planner - SmartMoney.com
http://money.msn.com/retirement/reti...alculator.aspx
Retirement Calculators - CNNMoney
AARP Retirement Calculator - How to Retire, Plan for Retirement, What Is Retirement? - AARP

and, of course: FIRECalc: A different kind of retirement calculator
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Old 07-19-2012, 11:51 AM   #4
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Quote:
Originally Posted by imoldernu View Post
Am certain that the subject is covered here (somewhere)... but going through tens of thousands of posts is a bit daunting.

So here's the question:
Most of the websites that cover the "dollars needed to retire" ignore Social Security, at the end of the calculation. Why? Perhaps because this amount is considered too small to be bothered with? In my case, it's important....

The problem that I see is, when trying to decide whether or not to retire, that amount has to be added in, making the calculation more difficult, especially long term, when inflation has to be calculated.

For a couple. the annual SS can be a substantial supplement, or in my case, a major part of base planning.

Thoughts?
I think it's OK to include Social Security; it is an important part of most people's retirement...for my own parents, it's about a third of their income in retirement. Today it is par for the course to say "I'm not planning on Social Security because I don't think it will be there when I retire", but I don't think that statement is true. I always figure in what the SS calculator says and then I take 70% of that as what I consider to be a more accurate probability.
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Old 07-19-2012, 12:09 PM   #5
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I think the most common response around here has been that to be safe, in anticipation of deficit reduction measures, assume about 70-80% of your projected SS income will materialize. So, back that amount out of your annual expenses when figuring out how big your nest egg should be.
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Old 07-19-2012, 12:18 PM   #6
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Originally Posted by donheff View Post
I think the most common response around here has been that to be safe, in anticipation of deficit reduction measures, assume about 70-80% of your projected SS income will materialize. So, back that amount out of your annual expenses when figuring out how big your nest egg should be.
+1

In the absence of a calculator input, this is what I would do. SS should inflate along with your expenses, lasts exactly as long as your expenses, and can't be used to rebalance your portfolio. The only real problem is getting the calculator to start it when you want.
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Old 07-19-2012, 12:56 PM   #7
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Quote:
Originally Posted by Bestwifeever View Post
I found most retirement calculators include SS--maybe those that do not include it are attracting more of a global audience and trying to keep it simple.

Here are several that let you factor SS into the results:

SmartMoney Retirement Planner - SmartMoney.com
Retirement calculator: How much should I save for retirement? - MSN Money
Retirement Calculators - CNNMoney
AARP Retirement Calculator - How to Retire, Plan for Retirement, What Is Retirement? - AARP

and, of course: FIRECalc: A different kind of retirement calculator
Thanks... a little hard to use most, if one is at the point of retirement, since most calculators require an income input.
Here's a site I use, to find out how long my money will last.I'm Retired, How Long Will My Savings Last? | Calculators by CalcXML
The suggestion to reduce "needs" by the SS a/c amount looks to be the easiest way .
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Old 07-19-2012, 07:00 PM   #8
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Hmm, I guess I hadn't thought that people who are already retired would need a calculator.
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