Social security calculation

[Wingnut]

I spent some time on the social security site recently, looking at various scenarios, but the calculator is so basic, it doesn't address my situation. I wonder if anyone has found a better calculator that can answer this:
Will retire at 55, in two years with 2 additional years of passive income (parachute) in excess of max ss cap and reported on w-2. I have over 30 years of qualified participation.
Wife is swiss, and we will reside in switzerland full time effective 2016. She will be 43 at my retirement and will continue to work for 5-7 more years in switzerland.
I do not plan on taking social security until 67 or 70. We are more than ok, financially, and our health is great. We both have good genes too. Lots of old timers on both sides of the family.

I cannot find a calculator that does not assume i will start to draw benefits at 62 if younger than 62 when i stop contributing.

If someone has a link to one, i'd appreciate it!

 

[bizlady]

The online SS calculator allows you to enter other scenarios.

I think AARP also has one you may find helpful.

 

[Wingnut]

I'll check again. I was somewhat rushed today. Thanks.

 

[racy]

Hi Wing,
If you like spreadsheet work, you can do it yourself. How? Here: How to Calculate Social Security Benefits - A Step by Step Guide

Also, on the ssa.gov site, using their retirement estimator, it asks for last year's earnings. If you enter 0, then it'll stop assuming that you're earning money till age 62, 66 and 70, and show you benefits.

One last thing, SS uses 35 years of earnings; years with no earnings get averaged in as 0's.

 

[scrabbler1]

Several years ago, as I was working on my longer-term ER picture, I created a spreadsheet like the one Racy linked to as far as instructions go. I used the description of the calculations shown in the SSA website. I downloaded their anypia calculator but could not get it to work right away. A few years later, with some help from others here in this forum, I gave it another try and got it to work. Its calculations such as the all important AIME were very nearly the same as my spreadsheet's so I knew I was doing it right. That included lots of zeroes for annual wages starting in 2009, my first full year of ER.

Once I had all of my wage earnings by year, all I did from time to time is to find and paste from the SSA website a new set of wage index factors and bend points and my spreadsheet would automatically get updated.

 

[Rustward]

I spent some time on the social security site recently, looking at various scenarios, but the calculator is so basic, it doesn't address my situation. I wonder if anyone has found a better calculator that can answer this:
Will retire at 55, in two years with 2 additional years of passive income (parachute) in excess of max ss cap and reported on w-2. I have over 30 years of qualified participation.
Wife is swiss, and we will reside in switzerland full time effective 2016. She will be 43 at my retirement and will continue to work for 5-7 more years in switzerland.
I do not plan on taking social security until 67 or 70. We are more than ok, financially, and our health is great. We both have good genes too. Lots of old timers on both sides of the family.

I cannot find a calculator that does not assume i will start to draw benefits at 62 if younger than 62 when i stop contributing.

If someone has a link to one, i'd appreciate it!

I wonder if anyone has found a better calculator that can answer this:

What is the question?

Wingnut, would this summarize your situation?

You plan to stop work at 55.
You will have paid into SS for over 30 years when you stop work.
You plan to start your social security benefit at 67 or 70.

The online calculator can answer this, as can the downloadable detailed calculator.

Unless I am mistaken, all the other information is not needed.

 

[Independent]

I spent some time on the social security site recently, looking at various scenarios, but the calculator is so basic, it doesn't address my situation. I wonder if anyone has found a better calculator that can answer this:
Will retire at 55, in two years with 2 additional years of passive income (parachute) in excess of max ss cap and reported on w-2. I have over 30 years of qualified participation.
...
I do not plan on taking social security until 67 or 70.
...

I cannot find a calculator that does not assume i will start to draw benefits at 62 if younger than 62 when i stop contributing.

If you have found a calculator that accurately figures your benefit at age 62, assuming you've quit working before then, then it's easy to get benefits starting at any other age.

If you were born in 1960 (or later) your Normal Retirement Age is 67.

In this case, your benefit starting at age 62 is 70% of your benefit if you start at age 67.

If you start later than 67, your benefit goes up by 8% (not compounded) for each additional year.

So, if your calculator tells you that your benefit at 62 is $1,400/mo,
then you would get $1,400 / .70 = $2,000 if you start at 67,
and $2,000 x 1.24 = $2,480 if you start at 70.


Early or Late Retirement

 

[Cat-tirement]

Social Security does have a more detailed calculator that you can download. Take a look at Social Security Detailed Calculator.

Unfortunately they are still using ancient tools to build the Mac version, so although they keep the content up to date, it won't run on anything newer than 10.6 Snow Leopard. (Not that big a deal to me, as I still have several old Macs around.)

 

[ImThinkin2019]

I tried the SS calculators and got some numbers from them, but they were not consistent with the statements sent to me, or other types of SS calculators.

Because I wanted more precise info I searched around and finally bought ES Planner. This is the forum post by them that convinced me to do it:

Why ESPlanner Projects Higher Benefits than Social Security

• FAQ
• Retirement Benefits
• Social Security

We have tested our benefit calculator against Social Security's ANYPIA calculator and generate the same benefits to with a couple of dollars in the case of workers who are 62 or older and have all their earnings in the past.
Where ESPlanner differs from Social Security's ANYPIA is with respect to projecting benefits for workers who have some of their earnings coming in the future. In such cases, Social Security appears to assume there will be zero future inflation and zero economy-wide real wage growth. These are unrealistic assumptions, to be kind, but they are invoked, we suspect, to prevent Social Security from ever providing a benefit projection that exceeds what the system is legally mandated to provide. Our benefit calculator assumes that there will be inflation in the future as well as real wage growth. Our assumptions in this regard are taken from the latest Social Security's Trustees Report, which needs to make these assumptions in order to project Social Security's long-term finances.

Why ESPlanner Projects Higher Benefits than Social Security | ESPlanner Inc.

We will stop working at around 60 and take SS later. We very much liked how this calculator worked, and think it is as accurate as any.

 

[Wingnut]

Wow. Thanks a lot for the great posts. Now I have some rainy day work to do!

 

[explanade]

The Retirement Estimator has you enter your social security number and mother's maiden name:

Retirement Estimator

But there is a "Quick" Calculator here:

Quick Calculator

And that produces a vastly different number. It seems there if you enter your last year of earnings, it goes backwards and extrapolates your earnings against that last year figure?

So it doesn't use the actual earnings you've accrued?

 

[DoWright]

Congratulations on your early retirement and on not needing to rely on your Social Security benefits, so (as a byproduct of that) enabling you maximize the monthly benefits that you will receive.

ESPlanner and the Social Security detailed calculator are both excellent. But my favorite site is at Vanguard: https://retirementplans.vanguard.com/VGApp/pe/pubeducation/calculators/RetirementNestEggCalc.jsf

The tool is incredibly easy to use and allows you to run any scenario:

• how many years do I need to have the money last (or said differently: at what age will I die)
• how much cash will I have when I retire and need to start extracting money
• how much money will I extract annually
• what is my asset allocation

Enter values into each of these criteria and then run a simulation. The tool will then run a Monte Carlo simulation and tell you the likelihood that you will outlive your money.

You can quickly and easily tweak you input variables and run a new scenario.

David

 

[MichaelB]

Enter values into each of these criteria and then run a simulation. The tool will then run a Monte Carlo simulation and tell you the likelihood that you will outlive your money.

We have a tool here, called FIRECalc, which you can access at the bottom of the page. Easy to use, instead of Monte Carlo it uses real return history to determine how your portfolio, pensions, and withdrawal scheme would have fared. See it here FIRECalc: A different kind of retirement calculator

 

[DoWright]

We have a tool here, called FIRECalc, which you can access at the bottom of the page. Easy to use, instead of Monte Carlo it uses real return history to determine how your portfolio, pensions, and withdrawal scheme would have fared. See it here FIRECalc: A different kind of retirement calculator

Cool. I will check that out.

David

 

[sebvad]

Somewhat related - but more opportunistic given it's a SS thread... i've had it suggested to me that if i don't work for the last 15 years prior to SS retirement age, the benefits disappear. If i've worked for 25 years and retire at, say 45 - obviously if that's accurate there's a gap there that i'm not eager to lose. Is that mullarky or is there truth to it?

Edit: an important distinction, i suppose, would be that my plan would be to stop working early, but not begin drawing from SS until 67..

 

[REWahoo]

Use the calculator available at ssa.gov and plug in zeroes for the 15 years prior to retirement. That will show you the impact of retiring early - and that the benefits do not disappear...

 

[scrabbler1]

Somewhat related - but more opportunistic given it's a SS thread... i've had it suggested to me that if i don't work for the last 15 years prior to SS retirement age, the benefits disappear. If i've worked for 25 years and retire at, say 45 - obviously if that's accurate there's a gap there that i'm not eager to lose. Is that mullarky or is there truth to it?

Edit: an important distinction, i suppose, would be that my plan would be to stop working early, but not begin drawing from SS until 67..

They surely would not disappear. I worked for 23 years and retired at 45 five years ago. In fact, not a lot of them disappear because of the way the SS benefits formula is set up. All of the SS benefits I would lose are in the 15% "bend point," or wage income replacement bracket. For every $100 of reduced Average Indexed Monthly Earnings, or AIME, I "lose" only $15 of future benefits. I have retained all of my wage income replacement in the higher 32% and 90% brackets. I assume drawing from SS at my FRA of 67.

I encountered a similar phenomenon when I first switched from working full-time to part-time back in 2001. I reduced my weekly hours worked from 37.5 to 20, or a 47% drop in gross wage income. However, because the income tax structure is progressive, all of that reduction was taxed at my highest (at the time, 28% being reduced to 25% in 2001) marginal tax rate. My net income, after taxes, dropped by only 40%, and that doesn't count any secondary effects on other types of income such as having my investment income taxed at lower rates.

 

[sebvad]

Thanks gents, good to know. Interesting scenarios on the ssa site - if i work for 8 more years (until i'm 50), that translates to less than a $5000 difference per year (future dollars) vs working until 45. From a SS perspective at least, that's not a terribly compelling argument to continue to work!

 

[unno2002]

To manually estimate a social security benefit, see the pub at:

http://www.socialsecurity.gov/pubs/10070-08.pdf

 

[WorkTillYouDont]

Use the calculator available at ssa.gov and plug in zeroes for the 15 years prior to retirement. That will show you the impact of retiring early - and that the benefits do not disappear...

I must be missing something, because I'm finding all those calculators on the Social Security site extremely unhelpful if you're not planning to collect benefits the second you retire.

The labor-intensive one assumes collecting at 62 if you key in retirement at 55, which is a slight improvement, but ...

 

[pb4uski]

I must be missing something, because I'm finding all those calculators on the Social Security site extremely unhelpful if you're not planning to collect benefits the second you retire.

The labor-intensive one assumes collecting at 62 if you key in retirement at 55, which is a slight improvement, but ...

but it is relatively easy to convert the amount you will receive at 62 (assuming you stop working at 55) to your PIA or age 70 benefit (or any age between 62 and 70).

I concede though that it would be nice if they could add selecting a start drawing date to that calculator in addition to the stop working date.

 

[ImThinkin2019]

I must be missing something, because I'm finding all those calculators on the Social Security site extremely unhelpful if you're not planning to collect benefits the second you retire.

The labor-intensive one assumes collecting at 62 if you key in retirement at 55, which is a slight improvement, but ...

Yes, this is why we ended up with ESPlanner. Like most of us here, I tried to use every free tool including my own spreadsheets before finally shelling out the $150 to get ESPlanner. Now that we have it we're really happy we got it, and we have much better confidence in our strategy.

 

[scrabbler1]

After viewing the SSA benefit calculation about 5 years ago, I was able to create a spreadsheet to mimic it and enter my own earnings history. I had downloaded their AnyPIA calculator program but had trouble using it initially. After seeing some threads on that item a year or two later, I gave it another try and it worked! I used it as a check on my spreadsheet and I came to within a dollar of my projected monthly benefit (probably some rounding issue). I had entered a bunch (about 13 of them) of zeroes to fill in all the earnings years needed to get to 35.

Just for kicks, I decided to change those zeroes to actual earnings had I kept working and received "average" raises of 2-3%. Because I was in the 15% Bend Point, my projected monthly benefit would have gone up about 11%, not a whole lot.

 

[pb4uski]

Could you post a generic version of that spreadsheet (with hypothetical data rather than your personal data)?

 

[DatumPoint5]

Could you post a generic version of that spreadsheet (with hypothetical data rather than your personal data)?

+1