Social Security for (relatively) young er

[JJac]

Hi,

I checked the online calculator on the ssa.gov website today, and it says even if I quit working today, I can get 900 a month in today's dollars when I am eligible to withdraw 30 years from now!

I honestly believe that in 30 years I will get 0, but does this sound correct? After 10 years of working, I would be eligible for a SS payout?

Thanks!

Jeremy

 

[MasterBlaster]

I think that's right. Under their present rules you only need 40 quarters (10 years) of work to be eligible for a benefit.

As a ballpark number take your benefit at full retirement age and subtract off 1 percent for every year early that you retire. So, for example, if you retire at 35 after working 10 years your SS benefit will be cut by around 30 percent.

Keep in mind that some of us expect the rules to change in the not too distant future.

 

[d]

best check to see the earnings assumptions they used!

 

[Cut-Throat]

Hi,

I checked the online calculator on the ssa.gov website today, and it says even if I quit working today, I can get 900 a month in today's dollars when I am eligible to withdraw 30 years from now!

I honestly believe that in 30 years I will get 0, but does this sound correct? After 10 years of working, I would be eligible for a SS payout?

Thanks!

Jeremy

Yes, this sounds about right. I think you need 40 quarters of Pay-ins. Get a statement from the Government.

I believe that your benefits will be cut a bit. But, I really think you will get at least 75% of the benefit. You may get 100% of the benefit, but eligbility date may be moved out a couple of years. It may be indexed to inflation instead of wage growth)

There are only a few minor tweaks needed to make S.S. Secure. - Private Accounts is not one of them. That would only make it worse! Indexing to inflation instead of wages would fix it all by itself! - Bush Jr. got everyone excited about S.S. - He should have been talking about Medicare! - Not sure what's going to fix this!

 

[FIRE'd@51]

Indexing to inflation instead of wages would fix it all by itself!

Of course, this would result in a cut in benefits, so it wouldn't really be a fix if your goal is to retain the current level of benefits.

 

[Cut-Throat]

Of course, this would result in a cut in benefits, so it wouldn't really be a fix if your goal is to retain the current level of benefits.

Well if you want to nit pick, so is delaying the age of eligibilty cutting benefits and also dying early is cutting your benefits. :

My goal was only to shed light on the original posters question.

 

[Dawg52]

It's gonna be hard to fix without some pain being involved. Not sure what the fix is but when I project my future income from all sources, I use 75% of the number thats shown of the ss calculator. I hope it is more than that.

 

[JJac]

Thanks everybody

best check to see the earnings assumptions they used!

The assumptions were pretty acurate. I have earned above the social security limit for at least the last 7 or 8 years.

As a ballpark number take your benefit at full retirement age and subtract off 1 percent for every year early that you retire. So, for example, if you retire at 35 after working 10 years your SS benefit will be cut by around 30 percent.

Keep in mind that some of us expect the rules to change in the not too distant future.

Thanks MasterBlaster, this is an interesting and useful rule of thumb. I think I'm still going to plan assuming that the number is zero, but if a check shows up someday it will be fully appreciated.

I think I have last years SS statement buried in a box around here somewhere...
I was just amazed that the number wasn't zero in the first place

 

[New Thinking]

If you are using the Quick Calculator SSA is assuming that you keep working and have some wage increases..It is not based on what you have earned to-date but is a projection of a future value..You can click the assumptions used to find more info.

 

[JJac]

The quick calculator allows you to enter the year you retire, in this case 2008.

From the details page:
Note that the last year of earnings used in estimating your retirement benefit is the year before the year in which retirement begins (yours begins in 2008).


It shows the estimates used, with no earnings past 2007. I verified that this is indeed the case by calculating the change in benefits if I worked "just one more year"

The results for the curious:
Last day SS benefit at age 62
Jan-07 886
Jan-08 937
Jan-09 987
Jan-10 1038
Jan-11 1089
Jan-20 1361
Jan-30 1587
Jan-36 1594
Jan-40 2029

 

[youbet]

Yes JJac, SS is a progressive system! Payouts for low wage earners or limited timeframe wage earners are disproportionately favorable compared to long term, high wage earners. I'm NOT saying that's bad. Just pointing out that it is a progressive system.

Whether it should be even more progressive or not is another question!