Telly
Thinks s/he gets paid by the post
- Joined
- Feb 22, 2003
- Messages
- 2,395
As future Social Security benefit payments reduce our retirement fund's required "withdrawal rate", I thought this might be the forum to ask it in.
I'll round and simplify the question, hopefully I can get it across without mucking it up too bad
2002 was the last year Mr. Smith paid into S.S. Assume that he never has S.S. payroll earnings ever again. He is now 52 years old. He runs all the calculators available at ssa.org, inputting his past earnings, and puts zero earnings in for the future. The calculators all show that with retirement at age 62, he will get $1k a month, $12k a year. The calculator allows computing for TODAYS dollars, or an inflated amount they come up with, that looks like about 5% annual inflation over the 10 year period.
But what really is the PROPER way to view this? That the $12k a year in todays dollars, will be increased over the years between his age 52 and 62, such that the actual benefit at age 62 when he files will be higher than $12k?
In other words, between ages 52 and 62, his "account" will be adjusted for inflation of those interim 10 years?
Or, will the $12k a year that is projected today, because he has no future pay-ins to S.S., really be what he gets at age 62, no matter what inflation is in the interim?
I'll round and simplify the question, hopefully I can get it across without mucking it up too bad
2002 was the last year Mr. Smith paid into S.S. Assume that he never has S.S. payroll earnings ever again. He is now 52 years old. He runs all the calculators available at ssa.org, inputting his past earnings, and puts zero earnings in for the future. The calculators all show that with retirement at age 62, he will get $1k a month, $12k a year. The calculator allows computing for TODAYS dollars, or an inflated amount they come up with, that looks like about 5% annual inflation over the 10 year period.
But what really is the PROPER way to view this? That the $12k a year in todays dollars, will be increased over the years between his age 52 and 62, such that the actual benefit at age 62 when he files will be higher than $12k?
In other words, between ages 52 and 62, his "account" will be adjusted for inflation of those interim 10 years?
Or, will the $12k a year that is projected today, because he has no future pay-ins to S.S., really be what he gets at age 62, no matter what inflation is in the interim?