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New Free, Open-Source Social Security Calculator
Old 06-04-2018, 09:54 AM   #1
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New Free, Open-Source Social Security Calculator

Interesting post on Oblivious Investor today. I havenít tried it yet, but am simply passing this along.

https://obliviousinvestor.com/new-fr...ty-calculator/

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New Free, Open-Source Social Security Calculator
When deciding when to claim Social Security benefits, it can be helpful to use a calculator that runs the math for each possible claiming age (or, if youíre married, each possible combination of claiming ages) and reports back, telling you which strategy is expected to provide the most total spendable dollars over your lifetime.

Maximize My Social Security and Social Security Solutions are the two best-known paid calculators in the field. For a few years though, there was a decent (basic) free option as well: ďSSAnalyze,Ē hosted by an advisory firm called Bedrock Capital. Unfortunately, Bedrock Capital was bought by another financial firm late last year, and the buyer did not repost the calculator on their own site.

So, in April of this year I decided to make my own. Itís available now, and you can try it out it here:

https://opensocialsecurity.com/
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Old 06-04-2018, 10:16 AM   #2
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Interesting. It also gives you the present value of your benefit. Which is nice if you want to include it in your AA.
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Old 06-04-2018, 10:17 AM   #3
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The tool and result is interesting, but does not consider any income sources other than SS. So, for me, it is not of maximum value...
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Old 06-04-2018, 10:34 AM   #4
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Same result as all other calculators (and advisors) have returned:


I start at 62, DH takes spousal benefit when he reaches FRA that same year, and then he takes his full benefit at 70.


Good Lord willin' and the creek don't rise. Or dry up.


Thanks for sharing!
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Old 06-04-2018, 12:24 PM   #5
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For me, it says take at 62 + 3 months , and gets less overall as I increase the age ?
So why not at 62 + 1 month ?

What present value do they discount the future money as that would dramatically affect the result.

It seems too simple a calculator, as must use median age of death, so by definition it over estimates 1/2 the time and under estimates the other 1/2 .
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Old 06-04-2018, 12:27 PM   #6
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For me, it says take at 62 + 3 months , and gets less overall as I increase the age ?
So why not at 62 + 1 month ?

What present value do they discount the future money as that would dramatically affect the result.

It seems too simple a calculator, as must use median age of death, so by definition it over estimates 1/2 the time and under estimates the other 1/2 .
Its a guide. Anything or anybody that tries to predict the future is going to be problematic.
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Old 06-04-2018, 01:09 PM   #7
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.... What present value do they discount the future money as that would dramatically affect the result. ...
If you check the "Advanced" box near the top of the page then you'll see the discount rate assumption of 1% (0.01) under Other Inputs.

I philosophically disagree with using a TIPs rate since if I did take early I would stay with my current AA.... so I use 4%... a 6% investment return less 2% for inflation. Makes a big difference.

Obviously, you can calculate at 0% to see the undiscounted totals.

It also allows use of different mortality tables.
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Old 06-04-2018, 01:26 PM   #8
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It's a nice little free tool.

A bit too basic to rely on. It's unfortunate that it doesn't allow you to simply enter an expected mortality age, rather than being forced to use one of five mortality tables. That rather ruins things, IMHO.
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Old 06-04-2018, 01:29 PM   #9
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I haven't explored all options, either. My plan is to maximize total SS payments by waiting until 70 for the higher earner, and FRA for the lower to claim maximum spouse benefit. This strategy was $8,000 lower in present worth, based on average life expectancies.

So far I think we're better off maximizing the monthly payment, since it would be our only annuity. Our family ages at death have varied from 50 to 92.
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Technically not early retirement in 2015 at 64-1/2. 32% of men and 37% of women who claimed Social Security that year were 62. (Annual Statistical Supplement, 2016, Table 6.B5)
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Old 06-04-2018, 01:41 PM   #10
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Originally Posted by Sunset View Post
For me, it says take at 62 + 3 months , and gets less overall as I increase the age ?
So why not at 62 + 1 month ?

What present value do they discount the future money as that would dramatically affect the result.

It seems too simple a calculator, as must use median age of death, so by definition it over estimates 1/2 the time and under estimates the other 1/2 .
Did your case involve a spouse? Is it 62 & 3 months because claiming the spouse benefit requires the higher earner to file?

Also, Piper's default SS life expectancies are average (weighted), not median (midpoint between extremes).
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Technically not early retirement in 2015 at 64-1/2. 32% of men and 37% of women who claimed Social Security that year were 62. (Annual Statistical Supplement, 2016, Table 6.B5)
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Old 06-04-2018, 03:02 PM   #11
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Thank you for the feedback, everybody.

As noted above, you can use your own discount rate by checking the "advanced" box.

With regard to life expectancies, the calculator does not assume a given age at death. Rather, it uses year-by-year mortality rates to calculate the user's probability of being alive in each given future year, then probability-weights the benefit for that year. And as noted above you can choose a different mortality table if you prefer to do so.
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Old 06-04-2018, 04:23 PM   #12
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It told me to claim at 69 and 6 months. Not sure why that is better than 70 but not planning to that long. Still it was interesting.
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Old 06-04-2018, 04:32 PM   #13
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Thanks for posting this.
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Old 06-04-2018, 04:34 PM   #14
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It validated our plan. DW has no SS benefit (SAHM). She's a few years older than me. I'll start mine at her FRA (I'll be slightly north of 62). We decided that with my SS, SBP, my pension, and our nest egg, she will be fine without me (in more ways than one).
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Old 06-04-2018, 04:53 PM   #15
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Thanks for doing this.


I chose to implement a slightly different plan. When comparing my plan to the "suggested" plan, I only get a difference in NPV of 0.14%. It says my plan is not far off from the optimal one. I can live with that.
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Old 06-04-2018, 05:40 PM   #16
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I did miss seeing the advanced checkbox, as I was too excited to try this.

So I tried the advanced settings and got different results as expected.
However, here is something weird, when I reset all the advanced to what I thought would be given default, the result was still different from this morning.
So I closed the tab, and tried it again without using the advanced checkbox; the result was still different from this morning.
Now it says: "at age 62 and 5 months." for me, and the present value is lower by about $26K
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Old 06-04-2018, 06:34 PM   #17
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Originally Posted by Mike Piper View Post
Thank you for the feedback, everybody.

As noted above, you can use your own discount rate by checking the "advanced" box.

With regard to life expectancies, the calculator does not assume a given age at death. Rather, it uses year-by-year mortality rates to calculate the user's probability of being alive in each given future year, then probability-weights the benefit for that year. And as noted above you can choose a different mortality table if you prefer to do so.
Thanks, Mike. Your tool is a great start!

I do feel that having to select a mortality table is a deficiency in the tool. It's nice to use a table when you want to analyze a large population. But there are many individual factors that make such a table less appropriate for a single user or a couple. It's clear that income level is correlated with longevity. And it's clear that some medical conditions are negatively correlated with longevity.

Allowing the user to enter expected longevity for the user and the spouse would make the tool more powerful and would allow the exploration of more possibilities.

Anyway, thanks for deciding to release the tool!
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Old 06-04-2018, 06:36 PM   #18
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So I closed the tab, and tried it again without using the advanced checkbox; the result was still different from this morning.
Now it says: "at age 62 and 5 months." for me, and the present value is lower by about $26K
Maybe you had a really bad day and didn't realize it. But that tool knows...
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Old 06-04-2018, 07:41 PM   #19
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[Nevermind, bogleheads.org has a discussion on this.]

This calculator seems to assume that both husband and wife are no longer working. Is that what you all see?

"If you are collecting Social Security retirement benefits before full retirement age, your benefits are reduced by $1 for every $2 you earn above $17,040."

There are other details that are different as well.
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Old 06-04-2018, 08:06 PM   #20
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Thanks for sharing this tool!

Validated current plan for DH to claim at 62 and me at 70 is within a few months of optimal.
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