walkinwood
Thinks s/he gets paid by the post
Hello,
I noticed a little item in my last SS statement that tells me how much I've contributed to date to SS.
Assuming I ER this year, I took that number (I did not take employer contributions into account), a modest 7% annual return and calculated what that would grow to by the time I was 70 the year I would begin taking SS.
I then went to immediateannuities.com and found out what an immediate annuity with that final number calculated above (bought today) for a 70 year old would yield.
I was surprised that the monthly payout from the annuity was only $200 greater than what I'm supposed to get from SS. The annuity would be taxed and is not adjusted for inflation.
Obviously, when you take employer contributions into account, the difference would be much higher. And if I were to contribute to SS till 70 the difference would be higher still.
Anyone else want to do this calculation and confirm/refute what I found?
Full disclosure:
a) There is a flaw in my calculations above. I took my current contribution as the starting point. I should have calculated what the returns would be based on the date each contribution was made. But I'm too lazy to figure that out.
b) I am a supporter of SS as a safety net in old age, so I'm fine with the returns for me personally being less than what I could probably manage on my own.
I noticed a little item in my last SS statement that tells me how much I've contributed to date to SS.
Assuming I ER this year, I took that number (I did not take employer contributions into account), a modest 7% annual return and calculated what that would grow to by the time I was 70 the year I would begin taking SS.
I then went to immediateannuities.com and found out what an immediate annuity with that final number calculated above (bought today) for a 70 year old would yield.
I was surprised that the monthly payout from the annuity was only $200 greater than what I'm supposed to get from SS. The annuity would be taxed and is not adjusted for inflation.
Obviously, when you take employer contributions into account, the difference would be much higher. And if I were to contribute to SS till 70 the difference would be higher still.
Anyone else want to do this calculation and confirm/refute what I found?
Full disclosure:
a) There is a flaw in my calculations above. I took my current contribution as the starting point. I should have calculated what the returns would be based on the date each contribution was made. But I'm too lazy to figure that out.
b) I am a supporter of SS as a safety net in old age, so I'm fine with the returns for me personally being less than what I could probably manage on my own.