Social Security - Know What to Expect

[RASAP]

I patiently waited until I was 70 to file for my SS benefits. Ran all the calculators to get an estimate based on my earnings and the number always came out to 3962 per month (PIA = 3001.60 * 1.32). Pretty simple. Checked my MySocialSecurity account yesterday and it shows my benefit to be 3692 per month (270 lower) starting next month. Called the SS main number and after looking at my account, they agreed it should be 3962 and not 3692. Do you suppose that somewhere in the chain of determining benefits someone manually types in numbers and transposed the 2 middle digits? And I find myself wondering what would have happened had I not known what to expect and just accepted what they were going to provide. I'll let you know how the dispute process goes.

 

[harllee]

Any chance that the $3692 is after the deduction for Medicare premium?

 

[RASAP]

Nope, all of those figures were pre-deductions.

 

[MRG]

I patiently waited until I was 70 to file for my SS benefits. Ran all the calculators to get an estimate based on my earnings and the number always came out to 3962 per month (PIA = 3001.60 * 1.32). Pretty simple. Checked my MySocialSecurity account yesterday and it shows my benefit to be 3692 per month (270 lower) starting next month. Called the SS main number and after looking at my account, they agreed it should be 3962 and not 3692. Do you suppose that somewhere in the chain of determining benefits someone manually types in numbers and transposed the 2 middle digits? And I find myself wondering what would have happened had I not known what to expect and just accepted what they were going to provide. I'll let you know how the dispute process goes.

I wouldn't expect a human to enter any numbers in regard to your benefit. I'd rather think it's an error in a prior calculation or a misunderstanding. However given it's our government I guess it could be a human typing crapola in old green screens but I really don't believe it.

 

[COcheesehead]

Failing to account for adding in 0 years? 0 earnings years can decrease the benefit.

 

[RASAP]

Failing to account for adding in 0 years? 0 earnings years can decrease the benefit.

Could be I guess but the agent I talked with confirmed my PIA at 3001.60 which is exactly what I get using the AnyPIA app.

 

[SevenUp]

Failing to account for adding in 0 years? 0 earnings years can decrease the benefit.

Maybe it's semantics, but earning $0 in a year doesn't decrease the benefit, it just doesn't increase it.

One's total indexed earnings are divided by 35*12=420 to get the Average Indexed Monthly Earnings (AIME), regardless of how many years have been worked.

 

[COcheesehead]

Maybe it's semantics, but earning $0 in a year doesn't decrease the benefit, it just doesn't increase it.

One's total indexed earnings are divided by 35*12=420 to get the Average Indexed Monthly Earnings (AIME), regardless of how many years have been worked.

Getting in the weeds, but per SS.org

“If you stop work before you start receiving benefits and you have less than 35 years of earnings, your benefit amount is affected. We use a zero for each year without earnings when we calculate the amount of retirement benefits you are due. Years with no earnings reduces your retirement benefit amount.”

 

[RASAP]

Sounds right but, I have more than 35 years of earnings.

 

[SevenUp]

Getting in the weeds, but per SS.org

“If you stop work before you start receiving benefits and you have less than 35 years of earnings, your benefit amount is affected. We use a zero for each year without earnings when we calculate the amount of retirement benefits you are due. Years with no earnings reduces your retirement benefit amount.”

Sure, if one or more of your top 35 indexed earning years is $0, that will generally lead to a lower benefit than if one has 35 years of earnings.

But if one has, for example, 30 years with positive earnings and computes an estimated benefit at that time, choosing to stop working at that time (and thus having all future years with $0 earning) will not reduce the benefit estimated after 30 years of work.

Actually, we all start with years of $0 earnings until we get our first jobs.

Whether one has 1 year of earnings or 35, the total is divided by 420. There is no subtraction for a $0 year.

 

[rodi]

RASAP says he has 35 years of earnings. I assume those are <$0 years. I assume he has reviewed the statement in the anypia app and verified the $0 years from when he stopped working... He's almost 70, so it should be obvious.

I don't think the $0 years explains the mistake.

 

[Al18]

What does your SS statement from last year say for comparison?

 

[Sunset]

This is somewhat alarming, whether a typo or a systemic miscalculation, it means nobody can depend upon the number SS says.

I was pretty happily and carefully saving those yearly SS statements, but now the happy glow is gone.

 

[donheff]

It will be interesting to learn how this works out.

 

[target2019]

Sounds right but, I have more than 35 years of earnings.

Any additional earnings last two years? Sounds like, no, but thought I'd ask.

 

[Perryinva]

So was this the first time you looked at MySocialSecurity in all these years? (Doubtful!) Was the PIA amount the same as what you calculated? Has it been the same in previous years? Everything is based on PIA. To have a $270/month error would mean the PIA would have to be about $205 lower, a quite noticeable discrepancy. So all the incomes per year are correct? I log on to it probably 4-5 times a year at least for the last 10years plus (age 64). I had done the manual PIA calculations a few times over the years, when the formula page was listed, and printed them out. My results were always within a few dollars of what MSS calculated. When they dropped the form, I stopped doing it, but the numbers have always jived since then, since I had >35 years of max earned AGI, at 62, so my PIA increases by COLAs only, and has matched every year. Without knowing what pages you viewed, does the “slider” view still operate? It may not, since you are so near the end. That amount is even more than what the 2022 COLA increase was (~$215 for you). How very odd! Please keep us posted.

I assume no WEP, correct?

AACK!

 

[RASAP]

Yes, 35+ years of positive earnings. No earnings for the last several years. When I made application over the phone back in February, they quoted me 3962. The person I talked to on the phone last week along with the online and offline (AnyPIA) calculators confirm that my PIA is 3001.60. I think, but I am not sure, the PIA changes each year with COLA.

I intentionally left the following out so as not to cloud the issue. My spouse also filed for her SS in February. She gets a bump on hers based on mine because her earnings were low. The amount she gets starting this month is exactly what we were quoted and were expecting. This seems to confirm my PIA of 3001.60 is correct in the SS system.

 

[retiredunder50]

Is it possible that you were effected by a Windfall Elimination Provision reduction?

 

[RASAP]

Had to look that one up. Nope, that doesn't apply to me.

 

[RunningBum]

This is pretty odd. I tried to see if there was a mathematical way to come up with $3692. $3692 is 1.23 of 3001.60. If you were taking at 69, you'd get 1.24. Every month earlier you'd lose 2/3 of 1%. So 1.23 is not possible, so it can't be that they got your age wrong somehow.

 

[sengsational]

This situation is disconcerting to someone like me who gives full credence to the system; I never even checked the calculation for DW's benefit. I have those old annual paper statements, so I could check. I wonder how often this happens. If it's as likely to overpay as under pay, one must presume a later audit would have uncovered the program.

 

[RASAP]

Yeah, I got the same thing as you. Funny part is that the 1.23 is another transposition of digits - 1.32 vs. 1.23.

 

[xlf11]

Is it possible that you were effected by a Windfall Elimination Provision reduction?

WEP does not apply after 30 years of substantial earnings

 

[retiredunder50]

I believe WEP kicks in if several years of his employment were done while employed by an entity that did not require payments into social security and caused his number to be reduced to less than 30 years of substantial earnings. You don't get credit in the WEP calculation for the years you didn't pay into the SS system. On the social security statement, those years would have zero dollars for "Your Taxed Social Security Earnings." 35 years of earnings is not always equal to 35 years of taxed social security substantial earnings.

 

[ncbill]

Sure, if one or more of your top 35 indexed earning years is $0, that will generally lead to a lower benefit than if one has 35 years of earnings.

But if one has, for example, 30 years with positive earnings and computes an estimated benefit at that time, choosing to stop working at that time (and thus having all future years with $0 earning) will not reduce the benefit estimated after 30 years of work.

Actually, we all start with years of $0 earnings until we get our first jobs.

Whether one has 1 year of earnings or 35, the total is divided by 420. There is no subtraction for a $0 year.

Again, once you're past the second bend point relatively little additional earnings are credited to your monthly SS retirement check.

I would expect most professional workers "retiring early" in their 50s to be beyond that second bend point.