Help With Projecting Growth of Social Security Benefit at Age 70

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills.
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Help With Projecting Growth of Social Security Benefit at Age 70

Post by careerdata »

With recently being included in my employer's latest round of reductions-in-force (RIFs), and also turning age 58 this month, retirement may be closer in the window for me than originally anticipated. My wife is 13 years younger than me and she has just started her nursing career so we think we have a plan going forward to cover our living expenses. We received very helpful feedback from the BH community in another thread that I created last weekend regarding our future income, expenses, and current level of emergency savings. I am not sure how to link that specific thread here as a reference, but perhaps someone can help me with how to do that and I will add that later to this post.

[Update: Thanks community member ehh for adding the link to this thread that has the income, expense, and emergency savings details I put together last weekend. I have added the link to that thread here as well]:

viewtopic.php?t=405414

I have used the following BH recommended tools of ssa.tools and opensecurity.com to get the following information, with the assumption that I will not work going forward as a starting point:

Monthly Benefit Amounts

Age 62 + 1 Month Benefit = $2,330
Age 67 Normal Retirement Age Monthly Primary Insurance Amount (PIA) = $3,309
Age 70 Monthly Benefit Amount = $4,103

Here is how the Age 70 monthly benefit amount has increased on my Social Security Statement, year-over-year, assuming that I had kept working until Age 70 before drawing my Social Security:

Age 70 Monthly Benefit Amount from Social Security Statements with Earnings thru...

2016 = $3,606
2017 = $3,705 ($99 increase) (2.7% increase)
2018 = $3,807 ($102 increase) (2.8% increase)
2019 = $3,942 ($135 increase) (3.5% increase)
2020 = $4,086 ($144 increase) (3.7% increase)
2021 = $4,208 ($122 increase) (3.0% increase)
2022 = $4,527 ($319 increase) (7.6% increase)

On the Social Security website, it provided the following projected benefit numbers:

Employment Status / Age 62 Monthly Benefit / Age 67 NRA PIA / Age 70 Monthly Benefit Amount

Continue Working / $2,471 / $3,637 / $4,527
Stop Working / $2,330 / $3,309 / $4,103

Other factors:
--I now have 35 years of non-zero earnings, although there are four years that are very low when I was just out of school and then in between my first and second jobs.
--Of the 35 years it looks like 23 years exceeded the maximum salary for contributions (taxed Medicare earnings were greater than the taxed Social Security earnings).

In trying to organize these numbers for my wife, here are some questions I am hoping the BH community can help us with, assuming 2023 is my final year of work or at least the last year of the full-time work I did over the last 30-plus years:

--If I am no longer working after this year, and wait until Age 70 to start my Social Security, will my Age 70 monthly benefit amount continue to increase each year between now and 2035, when I would hopefully reach the Age 70 monthly benefit date? If so, how would that increase be determined by SSA and what would be a realistic way for us to project how that would increase given our current inflationary environment and the past history with SSA increases? If not, when would it stop increasing?

--Are the relatively small differences in the monthly benefit amounts between a) continuing to work to age 70 and b) stopping working due to the fact that I now have 35 years of earnings history with SSA, with 23 of those years at the highest coverage amount? In other words, are the relatively small differences in monthly benefit amounts due to having most of my potential earnings history now baked into the Age 70 monthly benefit calculation?

--Are there other tools or services you would recommend us using for planning other than the two that we have used so far (ssa.tools and opensecurity.com)?

Thank you in advance for taking the time to review our personal situation and to provide any guidance that you are comfortable sharing!

With great appreciation!

Joe
Last edited by careerdata on Sun Jun 04, 2023 3:33 pm, edited 3 times in total.
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253.

This means that your age 70 multiplier of 1.24 is applied to a different base each year. No one can calculate future inflation so there is no practical way to predict future benefit increases.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

David Jay wrote: Sun Jun 04, 2023 12:48 pm What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253.

This means that your age 70 multiplier of 1.24 is applied to a different base each year. No one can calculate future inflation so there is no practical way to predict future benefit increases.
Does your PIA really change each year even after FRA?
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

Yes.

For instance, at age 68, if one wants to get an accurate result from opensocialsecurity.com, one needs to use their current PIA, not a PIA from two years ago that did not include the 2022 and 2023 COLAs. You will notice that OpenSocialSecurity has no input for COLA, because COLA is built into the PIA.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
User avatar
teen persuasion
Posts: 2327
Joined: Sun Oct 25, 2015 1:43 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by teen persuasion »

And before age 63, the estimates are based on Indexing Factors for Earnings. The average wage index series looks at wage inflation over time, to make your 1990 earnings more equivalent to 2023 earnings.

https://www.ssa.gov/OACT/COLA/awifactors.html This link will allow you to pick a year for your past wages to be indexed to. Try 2023, and note the index factor for 1987: 3.2873870. Go back and try one year earlier, 2022, and note the same 1987 factor: 3.0189439. That change happens for every one of your years of earnings, which slightly increases your sum of indexed wages. Then the bend points are also indexed and move a bit upward each year, too. So a bit more income at 90% under the first bend point, a bit more at 32% between the bend points, etc.

But, yes, most of your earning potential is already baked into the history. The difference is each future year that *might* exceed and displace a lower past indexed year. If you have no zeroes to displace, the increase is only on the delta. If you are already above the second bend point, you are only gaining 15% on that delta/35.
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by careerdata »

David Jay wrote: Sun Jun 04, 2023 12:48 pm What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253.

This means that your age 70 multiplier of 1.24 is applied to a different base each year. No one can calculate future inflation so there is no practical way to predict future benefit increases.
Thank you! That is very helpful!

If 2023 is my last year of eligible earnings then I would expect my Age 70 PIA to increase at least one more time based upon the prior Social Security Statements, but will it increase each year thereafter until I reach the Age 63 measuring point you reference if I have no additional eligible earnings after 2023?

Your 8.7% PIA increase [($3,253 - $2,993)/$2,993] is in the ballpark of the 7.6% increase I am seeing on my Age 70 PIA using my earnings through 2022 so maybe the COLA you get is part of the calculation that they are using to project the increase to my Age 70 PIA?

Regards,

Joe
ehh
Posts: 724
Joined: Mon Feb 01, 2021 10:04 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by ehh »

careerdata wrote: Sun Jun 04, 2023 12:35 pm We received very helpful feedback from the BH community in another thread that I created last weekend regarding our future income, expenses, and current level of emergency savings. I am not sure how to link that specific thread here as a reference, but perhaps someone can help me with how to do that and I will add that later to this post.
viewtopic.php?t=405414
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

careerdata wrote: Sun Jun 04, 2023 1:21 pm
David Jay wrote: Sun Jun 04, 2023 12:48 pm What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253.

This means that your age 70 multiplier of 1.24 is applied to a different base each year. No one can calculate future inflation so there is no practical way to predict future benefit increases.
Thank you! That is very helpful!

If 2023 is my last year of eligible earnings then I would expect my Age 70 PIA to increase at least one more time based upon the prior Social Security Statements, but will it increase each year thereafter until I reach the Age 63 measuring point you reference if I have no additional eligible earnings after 2023?

Your 8.7% PIA increase [($3,253 - $2,993)/$2,993] is in the ballpark of the 7.6% increase I am seeing on my Age 70 PIA using my earnings through 2022 so maybe the COLA you get is part of the calculation that they are using to project the increase to my Age 70 PIA?

Regards,

Joe
Everything you have said is functional from an approximation standpoint, but strictly speaking your PIA is not determined until age 60, when all of your working years are inflated according to the National Wage Index from that year, the top 35 years are chosen, and those top 35 years are used to calculate your PIA.

After calculation, your PIA is adjusted each year for inflation and for any additional work years that are higher than one that is originally your top 35.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

careerdata wrote: Sun Jun 04, 2023 12:35 pm With recently being included in my employer's latest round of reductions-in-force (RIFs), and also turning age 58 this month, retirement may be closer in the window for me than originally anticipated. My wife is 13 years younger than me and she has just started her nursing career so we think we have a plan going forward to cover our living expenses. We received very helpful feedback from the BH community in another thread that I created last weekend regarding our future income, expenses, and current level of emergency savings. I am not sure how to link that specific thread here as a reference, but perhaps someone can help me with how to do that and I will add that later to this post.

I have used the following BH recommended tools of ssa.tools and opensecurity.com to get the following information, with the assumption that I will not work going forward as a starting point:

Monthly Primary Insurance Amounts (PIA)

Age 62 + 1 Month PIA = $2,330
Age 67 Normal Retirement Age Monthly PIA = $3,309
Age 70 Monthly PIA = $4,103

Here is how the Age 70 PIA projection has increased on my Social Security Statement, year-over-year, assuming that I had kept working until Age 70 before drawing my Social Security:

Age 70 PIAs from From Social Security Statements with Earnings thru...

2016 = $3,606
2017 = $3,705 ($99 increase) (2.7% increase)
2018 = $3,807 ($102 increase) (2.8% increase)
2019 = $3,942 ($135 increase) (3.5% increase)
2020 = $4,086 ($144 increase) (3.7% increase)
2021 = $4,208 ($122 increase) (3.0% increase)
2022 = $4,527 ($319 increase) (7.6% increase)

On the Social Security website, it provided the following PIA numbers:

Employment Status / Age 62 PIA / Age 67 NRA PIA / Age 70 PIA

Continue Working / $2,471 / $3,637 / $4,527
Stop Working / $2,330 / $3,309 / $4,103

Other factors:
--I now have 35 years of non-zero earnings, although there are four years that are very low when I was just out of school and then in between my first and second jobs.
--Of the 35 years it looks like 23 years exceeded the maximum salary for contributions (taxed Medicare earnings were greater than the taxed Social Security earnings).

In trying to organize these numbers for my wife, here are some questions I am hoping the BH community can help us with, assuming 2023 is my final year of work or at least the last year of the full-time work I did over the last 30-plus years:

--If I am no longer working after this year, and wait until Age 70 to start my Social Security, will my Age 70 PIA continue to increase each year between now and 2035, when I would hopefully reach the Age 70 PIA level? If so, how would that increase be determined by SSA and what would be a realistic way for us to project how that would increase given our current inflationary environment and the past history with SSA increases? If not, when would it stop increasing?

--Are the relatively small differences in the PIAs between a) continuing to work to age 70 and b) stopping working due to the fact that I now have 35 years of earnings history with SSA, with 23 of those years at the highest coverage amount? In other words, are the relatively small differences in PIAs due to having most of my potential earnings history now baked into the Age 70 PIA calculation?

--Are there other tools or services you would recommend us using for planning other than the two that we have used so far (ssa.tools and opensecurity.com)?

Thank you in advance for taking the time to review our personal situation and to provide any guidance that you are comfortable sharing!

With great appreciation!

Joe
"--If I am no longer working after this year, and wait until Age 70 to start my Social Security, will my Age 70 PIA continue to increase each year between now and 2035, when I would hopefully reach the Age 70 PIA level? If so, how would that increase be determined by SSA and what would be a realistic way for us to project how that would increase given our current inflationary environment and the past history with SSA increases? If not, when would it stop increasing?"
Your PIA will increase due to COLA's whether you have additional income or not. There is no way to know what future COLA's will be (or inflation).
Consider planning with present dollars and consider any returns without inflation as well.

"--Are the relatively small differences in the PIAs between a) continuing to work to age 70 and b) stopping working due to the fact that I now have 35 years of earnings history with SSA, with 23 of those years at the highest coverage amount?"
Yes- you are past the second bend point so any additional SS will be at a minimal rate. Search SS bends points if you want additional details.

"--Are there other tools or services you would recommend us using for planning other than the two that we have used so far (ssa.tools and opensecurity.com)?"
Opensocialsecurity is a great tool, but it is restricted to only your SS accounts. Consider working with retirement calculators which look at your entire plan for retirement including your entire portfolio and SS. A couple of these are RPM and Pralana....
RPM
https://www.bogleheads.org/wiki/Retiree_Portfolio_Model
Pralana
https://pralanaretirementcalculator.com/
User avatar
Watty
Posts: 28859
Joined: Wed Oct 10, 2007 3:55 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Watty »

I am a bit confused about your post. My understanding was that the PIA, "primary insurance amount", is the amount you would get if you start Social Security at your full retirement age(FRA). For people born in 1960 or later the FRA would be 67.

The PIA might change with inflation or if you change when you stop working but the mention of the PIA at different ages does not make a lot of sense to me.

You would of course get a different monthly benefit amount if you start receiving the benefit at a age that is different than your FRA that any increase or reduction is based on how many months there is between your FRA and when you start Social Security.

Unless I am missing something you may be using the term PIA incorrectly which could be confusing.
careerdata wrote: Sun Jun 04, 2023 12:35 pm --Are there other tools or services you would recommend us using for planning other than the two that we have used so far (ssa.tools and opensecurity.com)?
I never bothered to do it but if you want to do some heavy duty number crunching you should look at the Social Security AnyPIA tool.

https://www.ssa.gov/oact/anypia/anypia.html
David Jay wrote: Sun Jun 04, 2023 12:48 pm What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253.
You also need to keep in mind that the Open Social Security web site results will depend on the discount rate it used. There are old threads about this that you can look up but basically it uses a 20 year TIPS rate as the discount rate. A few years ago this was negative but now it is somewhere around 1.5% the last time I looked. This can change when the website suggests that you start SS.

This means that it is important to recheck that web site to see when it suggests that you should start Social Security.

In my case a few years ago it was clear that I should wait until I was 70. Now it still says that I should start it at 70 but the advantage was a lot smaller. My spouse had already started SS and now my starting at my FRA got something like 98% of the calculated value on the Open Social Security web site. The web site even has a graph that you can find which shows the difference. In my case there were some tax an other reasons that made sense for me to start my SS at my FRA since the other factors were more important than getting the last 2% out of Social Security.
Last edited by Watty on Sun Jun 04, 2023 1:41 pm, edited 1 time in total.
Silk McCue
Posts: 8951
Joined: Thu Feb 25, 2016 6:11 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Silk McCue »

careerdata wrote: Sun Jun 04, 2023 12:35 pm
--Are there other tools or services you would recommend us using for planning other than the two that we have used so far (ssa.tools and opensecurity.com)?

Joe
Quite honestly the SS tools you have already used provide very solid information. Along with the excellent feedback you are getting here there is no real need to explore other tools as they won’t add any significant value to you.

Edit to add. It’s best if you focus on the estimates in terms of todays’s dollars rather than how they will increase based upon inflation.

Cheers
Last edited by Silk McCue on Sun Jun 04, 2023 1:54 pm, edited 1 time in total.
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

David Jay wrote: Sun Jun 04, 2023 1:04 pm Yes.

For instance, at age 68, if one wants to get an accurate result from opensocialsecurity.com, one needs to use their current PIA, not a PIA from two years ago that did not include the 2022 and 2023 COLAs. You will notice that OpenSocialSecurity has no input for COLA, because COLA is built into the PIA.
I do know that the SS benefits change after FRA - I do not know if the actual PIA changes or if they call the increases something else and keep the PIA at FRA the same.
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by careerdata »

ehh wrote: Sun Jun 04, 2023 1:23 pm
careerdata wrote: Sun Jun 04, 2023 12:35 pm We received very helpful feedback from the BH community in another thread that I created last weekend regarding our future income, expenses, and current level of emergency savings. I am not sure how to link that specific thread here as a reference, but perhaps someone can help me with how to do that and I will add that later to this post.
viewtopic.php?t=405414
Thank you for adding that! I didn't realize I could have just opened up the other thread and copied the link into the body of the new thread. I have added it to my post made today as well.

Regards,

Joe
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

Watty wrote: Sun Jun 04, 2023 1:34 pmIn my case a few years ago it was clear that I should wait until I was 70. Now it still says that I should start it at 70 but the advantage was a lot smaller.
Mine has moved down to 69yr8mo, but I show 99% from 69yr0mo to 70yr0mo. My wife's benefit nearly triples when I file (she has only 41 quarter-credits), so her substantial increase moves our calculation.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

smitcat wrote: Sun Jun 04, 2023 1:38 pmI do know that the SS benefits change after FRA - I do not know if the actual PIA changes or if they call the increases something else and keep the PIA at FRA the same.
Two parts to the potential increase: Deferral Credit is 8/12 of 1% per month of delay (i.e. 8% per year) plus any increased PIA due to COLA increases.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by careerdata »

smitcat wrote: Sun Jun 04, 2023 1:31 pm
Your PIA will increase due to COLA's whether you have additional income or not. There is no way to know what future COLA's will be (or inflation).
Consider planning with present dollars and consider any returns without inflation as well.
Thank you! When you reference present dollars are you recommending we use the current monthly Age 70 amount of $4,103 based on my earnings through 2022?

If so, then as a reference point, if I started my pension from my former employer this year it would be $965, and if I add that to the Social Security payment of $4,103 I get $5,068 compared to our current average monthly living expenses of $6.3k, which includes two teenagers. My pension does not have a COLA provision. I realize there are a lot of additional factors to be included in that, but if we are trying to get things into today's dollars and ballpark figures then that would be a starting point for income versus expenses before looking at our investments.
smitcat wrote: Sun Jun 04, 2023 1:31 pm
Opensocialsecurity is a great tool, but it is restricted to only your SS accounts. Consider working with retirement calculators which look at your entire plan for retirement including your entire portfolio and SS. A couple of these are RPM and Pralana....
RPM
https://www.bogleheads.org/wiki/Retiree_Portfolio_Model
Pralana
https://pralanaretirementcalculator.com/
Thank you! I would like to take a stab at factoring in our investments into our planning. I have entered as much information as I could into Fidelity's portal as a start but I will try other tools like the ones you are recommending to get additional data points.

As it stands right now, we are approximately 75% equity and 25% fixed income for our $1 million in 401(k)s and Roths and we have approximately $90k in emergency funds (money market and I Bonds).

Regards,

Joe
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by careerdata »

teen persuasion wrote: Sun Jun 04, 2023 1:19 pm
But, yes, most of your earning potential is already baked into the history. The difference is each future year that *might* exceed and displace a lower past indexed year. If you have no zeroes to displace, the increase is only on the delta. If you are already above the second bend point, you are only gaining 15% on that delta/35.
Thank you! In looking at the output from ssa.tools it says my monthly average indexed earnings is $10,136 through 2022 and that the amount above $6,721 is multiplied by the 15% you reference. So in my discussions with my wife, I think the message has to be that although additional work can perhaps bump up my monthly Social Security benefit a little more if we wait until Age 70 to start, the real benefit from additional earnings between now and then would be to provide extra cushion for current expenses and building up our $1 million in retirement savings even more. Is that how you would summarize it?

Regards,

Joe
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by careerdata »

Watty wrote: Sun Jun 04, 2023 1:34 pm I am a bit confused about your post. My understanding was that the PIA, "primary insurance amount", is the amount you would get if you start Social Security at your full retirement age(FRA). For people born in 1960 or later the FRA would be 67.
Thank you! I updated the original post to see if I could make that a little clearer.
Watty wrote: Sun Jun 04, 2023 1:34 pm
I never bothered to do it but if you want to do some heavy duty number crunching you should look at the Social Security AnyPIA tool.

https://www.ssa.gov/oact/anypia/anypia.html
Thank you for sharing the link!
Watty wrote: Sun Jun 04, 2023 1:34 pm
You also need to keep in mind that the Open Social Security web site results will depend on the discount rate it used. There are old threads about this that you can look up but basically it uses a 20 year TIPS rate as the discount rate. A few years ago this was negative but now it is somewhere around 1.5% the last time I looked. This can change when the website suggests that you start SS.

This means that it is important to recheck that web site to see when it suggests that you should start Social Security.

In my case a few years ago it was clear that I should wait until I was 70. Now it still says that I should start it at 70 but the advantage was a lot smaller. My spouse had already started SS and now my starting at my FRA got something like 98% of the calculated value on the Open Social Security web site. The web site even has a graph that you can find which shows the difference. In my case there were some tax an other reasons that made sense for me to start my SS at my FRA since the other factors were more important than getting the last 2% out of Social Security.
Thank you for sharing your personal experience with this decision and why you did not wait until age 70 to start.

My starting perspective is to wait until age 70 if we can find a way to maintain our current living standards over the next 12 years, and even with me potentially retired starting later this year I think we can do that. My wife's starting perspective is, however, strongly on the other side, preferring instead that we start my pension now and take Social Security at age 62. She agreed that she would take time to review all the input from the BH community and then we reaccess as we get closer to my age 62, but we are both coming to this to start from dramatically different perspectives.

Regards,

Joe
Silk McCue
Posts: 8951
Joined: Thu Feb 25, 2016 6:11 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Silk McCue »

careerdata wrote: Sun Jun 04, 2023 3:32 pm
Thank you for sharing your personal experience with this decision and why you did not wait until age 70 to start.

My starting perspective is to wait until age 70 if we can find a way to maintain our current living standards over the next 12 years, and even with me potentially retired starting later this year I think we can do that. My wife's starting perspective is, however, strongly on the other side, preferring instead that we start my pension now and take Social Security at age 62. She agreed that she would take time to review all the input from the BH community and then we reaccess as we get closer to my age 62, but we are both coming to this to start from dramatically different perspectives.

Regards,

Joe
You taking SS at 62 unless absolutely necessary will likely have a substantial long term negative impact on your joint finances. One or both of you could live into your 90s. The surviving spouse will benefit from the higher of the two benefits being received. Given your age difference claiming before 70 could (no idea what her benefit will be) impact your wife quite negatively down the line.

I would carefully explore all options before claiming early.

There are a number of us at Bogleheads that utilize the services of Mark Zoril and team at planvisionmn.com. Although we have very solid plan having retired 2 years ago at ages 60/62 I use them for a second set of eyes but primarily as a trusted provider should I predecease my wife. They have a unique business model that is ridiculously cheap that uses the sophisticated EMoney platform. Cost for first year is $239 and a then $8 a month thereafter. No long term commitment.

Cheers
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by careerdata »

Silk McCue wrote: Sun Jun 04, 2023 4:05 pm
There are a number of us at Bogleheads that utilize the services of Mark Zoril and team at planvisionmn.com. Although we have very solid plan having retired 2 years ago at ages 60/62 I use them for a second set of eyes but primarily as a trusted provider should I predecease my wife. They have a unique business model that is ridiculously cheap that uses the sophisticated EMoney platform. Cost for first year is $239 and a then $8 a month thereafter. No long term commitment.

Cheers
Thank you for the suggestion! With me being 13 years older, and my wife not born in this country, I do worry quite a bit about who can provide her financial advice should I pass before her. As this and other BH posts show, I still have A LOT to learn myself! I am the second youngest of eight children in my family and my parents and my wife's parents are long since passed. In many ways, my wife and I feel it is just the two of us with our kids to rely upon.

I do get her to read my posts here on BH, and I've updated the Fidelity site with all investment details so she has almost everything in one location now, but having a third party that she could go to that has a proven track record of solid advice and support would be very beneficial. Trust is earned over time, not given.

If anyone else has a positive experience to share regarding this firm then that would be greatly appreciated, as my wife will hopefully have time later this week to catch up on the discussion in the thread.

Regards,

Joe
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

careerdata wrote: Sun Jun 04, 2023 3:32 pmMy starting perspective is to wait until age 70 if we can find a way to maintain our current living standards over the next 12 years, and even with me potentially retired starting later this year I think we can do that. My wife's starting perspective is, however, strongly on the other side, preferring instead that we start my pension now and take Social Security at age 62. She agreed that she would take time to review all the input from the BH community and then we reaccess as we get closer to my age 62, but we are both coming to this to start from dramatically different perspectives.
The most important data point in this discussion is that, for a married couple, the amount of the survivor's benefit (regardless of which spouse passes) is the larger of the two benefits. So the calculation for the payback of higher earner's benefit uses the longevity of the second to pass. This has huge implications for your much younger spouse.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
Silk McCue
Posts: 8951
Joined: Thu Feb 25, 2016 6:11 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Silk McCue »

careerdata wrote: Sun Jun 04, 2023 4:35 pm

If anyone else has a positive experience to share regarding this firm then that would be greatly appreciated, as my wife will hopefully have time later this week to catch up on the discussion in the thread.

Regards,

Joe
Type planvision into the search box and you will find prior posts. That includes one where someone’s expectations did not align with what was clearly communicated if you took the time to watch their videos and understand their offering. Even on that post you will many other happy users that provided feedback.

Take time to look at the website and definitely take time to watch a series of short videos that describe the service. Bottom line for me is that he will refund your money if after engaging with them you find are not happy. You can’t ask for more than that.

https://planvisionmn.com/get-started/

Cheers
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by careerdata »

David Jay wrote: Sun Jun 04, 2023 4:45 pm
careerdata wrote: Sun Jun 04, 2023 3:32 pmMy starting perspective is to wait until age 70 if we can find a way to maintain our current living standards over the next 12 years, and even with me potentially retired starting later this year I think we can do that. My wife's starting perspective is, however, strongly on the other side, preferring instead that we start my pension now and take Social Security at age 62. She agreed that she would take time to review all the input from the BH community and then we reaccess as we get closer to my age 62, but we are both coming to this to start from dramatically different perspectives.
The most important data point in this discussion is that, for a married couple, the amount of the survivor's benefit (regardless of which spouse passes) is the larger of the two benefits. So the calculation for the payback of higher earner's benefit uses the longevity of the second to pass. This has huge implications for your much younger spouse.
Thank you! Even if my wife worked another 20 years, to age 65, because she was a SAHM for most of our marriage to care for our autistic daughter and her related therapies, my wife's Social Security benefit would be much lower than mine due to her not having 35 years of earnings and perhaps likely no years making the maximum covered salary amount. We both could be in better health but nothing as yet from our doctors that would indicate a dramatically lower lifespan than the actuarial tables. I know that health can change in an instant, of course, but it is what we know as of now.

I think there is a much more compelling case for us to delay my starting Social Security until age 70 based but we have to be flexible as things change, and we need to be on the same page regardless of what we end up doing, as the decision will impact the two of us as well as our two children.

Regards,

Joe
Carl53
Posts: 2693
Joined: Sun Mar 07, 2010 7:26 pm

Re: Help With Projecting Growth of Social Security Benefit at Age 70

Post by Carl53 »

Assuming that your wife is now paying into SS via her nursing career, you can simulate her own projected SS benefits using the AnyPIA link provided earlier in the thread. If she has only modest SS covered earnings prior to this new nursing career it is highly unlikely that her own benefits will ever approach the projected PIA numbers for you. In any case you might try various scenarios for her working career with it. Then take your PIA numbers together with hers to see what OpenSocialSecurity says. Pay particular attention to the numbers it shows should either of you pass. Being 13 years older you are more likely to pass and she will be eligible for your higher benefit. Study up on when it might be most beneficial for her to take widow's benefit should you not live to a ripe old age and then provide her some written advice (good thing to do on a variety of topics). Widows benefits are reduced somewhat if they take them before their survivor FRA (might be a few months earlier than her regular FRA). Also, I advised my wife to not remarry before age 60 should I pass before she reached that age so as to not forfeit the option to take my pretty good benefits. Of course she might remarry someone very wealthy but as far as SS benefits she would be hard pressed to do better.

A lot of what you end up deciding to do depends on your financial holdings, potential income like pensions or rents, insurance coverage, her thoughts on to what age she might want to work etc. There are a number of tools available for you to run various scenarios.
Topic Author
careerdata
Posts: 332
Joined: Sat Sep 09, 2017 7:12 pm

Re: Help With Projecting Growth of Social Security Benefit at Age 70

Post by careerdata »

Carl53 wrote: Sun Jun 04, 2023 6:03 pm Assuming that your wife is now paying into SS via her nursing career, you can simulate her own projected SS benefits using the AnyPIA link provided earlier in the thread. If she has only modest SS covered earnings prior to this new nursing career it is highly unlikely that her own benefits will ever approach the projected PIA numbers for you. In any case you might try various scenarios for her working career with it. Then take your PIA numbers together with hers to see what OpenSocialSecurity says. Pay particular attention to the numbers it shows should either of you pass. Being 13 years older you are more likely to pass and she will be eligible for your higher benefit. Study up on when it might be most beneficial for her to take widow's benefit should you not live to a ripe old age and then provide her some written advice (good thing to do on a variety of topics). Widows benefits are reduced somewhat if they take them before their survivor FRA (might be a few months earlier than her regular FRA). Also, I advised my wife to not remarry before age 60 should I pass before she reached that age so as to not forfeit the option to take my pretty good benefits. Of course she might remarry someone very wealthy but as far as SS benefits she would be hard pressed to do better.

A lot of what you end up deciding to do depends on your financial holdings, potential income like pensions or rents, insurance coverage, her thoughts on to what age she might want to work etc. There are a number of tools available for you to run various scenarios.
Thank you! I will have to gather her earnings from when she worked a couple of years part-time at the school cafeteria before starting part-time work as a patient care technician while going to nursing school, but here are her Medicare-eligible wages from her W-2s for the last four tax years, that covered her time in nursing school and her first year as a nurse, with the 2023 numbers projected:

2019 = $8.4k
2020 = $19.1k
2021 = $26.9k
2022 = $89.8k
2023 = $125.2k (projected)

For the initial OpenSecurity modeling I put in $0 for her PIA but I will use the AnyPIA link to do some different projections once I have all her W-2 earnings history from the school cafeteria gathered.

The "not to remarry before age 60" provision is interesting so I will need to review that more. My wife is always looking to trade me in for a newer model but maybe this provision will give her some pause! :happy

Per your recommendation, we will also take a closer look at the widow benefits to make sure we understand that provision fully.

As far as projecting her future earnings, a lot depends on how long she wants to work bedside. On her cardiology floor that is where the money is right now as the work is VERY challenging and they are having a hard time finding nurses locally. On many shifts that she works on it is just her and the charge nurse that are full-time employees--the other four nurses on the shift are travel nurses coming in from all corners of the U.S. As a nurse, there are other paths she can take outside of bedside but the earning potential on those is less. She does not think she would ever want to be a travel nurse, where she would only have to work perhaps 8 or 9 months out of the year for the same pay she earns now, but maybe that too may change over time.

Thank you again for your suggestions and recommendations!

Regards,

Joe
Carl53
Posts: 2693
Joined: Sun Mar 07, 2010 7:26 pm

Re: Help With Projecting Growth of Social Security Benefit at Age 70

Post by Carl53 »

careerdata wrote: Sun Jun 04, 2023 7:00 pm
Carl53 wrote: Sun Jun 04, 2023 6:03 pm Assuming that your wife is now paying into SS via her nursing career, you can simulate her own projected SS benefits using the AnyPIA link provided earlier in the thread. If she has only modest SS covered earnings prior to this new nursing career it is highly unlikely that her own benefits will ever approach the projected PIA numbers for you. In any case you might try various scenarios for her working career with it. Then take your PIA numbers together with hers to see what OpenSocialSecurity says. Pay particular attention to the numbers it shows should either of you pass. Being 13 years older you are more likely to pass and she will be eligible for your higher benefit. Study up on when it might be most beneficial for her to take widow's benefit should you not live to a ripe old age and then provide her some written advice (good thing to do on a variety of topics). Widows benefits are reduced somewhat if they take them before their survivor FRA (might be a few months earlier than her regular FRA). Also, I advised my wife to not remarry before age 60 should I pass before she reached that age so as to not forfeit the option to take my pretty good benefits. Of course she might remarry someone very wealthy but as far as SS benefits she would be hard pressed to do better.

A lot of what you end up deciding to do depends on your financial holdings, potential income like pensions or rents, insurance coverage, her thoughts on to what age she might want to work etc. There are a number of tools available for you to run various scenarios.
Thank you! I will have to gather her earnings from when she worked a couple of years part-time at the school cafeteria before starting part-time work as a patient care technician while going to nursing school, but here are her Medicare-eligible wages from her W-2s for the last four tax years, that covered her time in nursing school and her first year as a nurse, with the 2023 numbers projected:

2019 = $8.4k
2020 = $19.1k
2021 = $26.9k
2022 = $89.8k
2023 = $125.2k (projected)

For the initial OpenSecurity modeling I put in $0 for her PIA but I will use the AnyPIA link to do some different projections once I have all her W-2 earnings history from the school cafeteria gathered.

The "not to remarry before age 60" provision is interesting so I will need to review that more. My wife is always looking to trade me in for a newer model but maybe this provision will give her some pause! :happy

Per your recommendation, we will also take a closer look at the widow benefits to make sure we understand that provision fully.

As far as projecting her future earnings, a lot depends on how long she wants to work bedside. On her cardiology floor that is where the money is right now as the work is VERY challenging and they are having a hard time finding nurses locally. On many shifts that she works on it is just her and the charge nurse that are full-time employees--the other four nurses on the shift are travel nurses coming in from all corners of the U.S. As a nurse, there are other paths she can take outside of bedside but the earning potential on those is less. She does not think she would ever want to be a travel nurse, where she would only have to work perhaps 8 or 9 months out of the year for the same pay she earns now, but maybe that too may change over time.

Thank you again for your suggestions and recommendations!

Regards,

Joe
You can have her open an account at the SSA website and see what they have for her eligible earnings. If she was working for a school cafeteria, it is possible that those earnings did not have SS but only medicare taken out. The SSA website will let her see what they say her history is. If she disagrees with it there is a process that you might challenge it. Likely you will have to supply your own info for the last year or two (which you have) besides the SSA website earnings history, and whatever she thinks her future earnings might be as input to AnyPIA.
User avatar
teen persuasion
Posts: 2327
Joined: Sun Oct 25, 2015 1:43 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by teen persuasion »

careerdata wrote: Sun Jun 04, 2023 3:02 pm
teen persuasion wrote: Sun Jun 04, 2023 1:19 pm
But, yes, most of your earning potential is already baked into the history. The difference is each future year that *might* exceed and displace a lower past indexed year. If you have no zeroes to displace, the increase is only on the delta. If you are already above the second bend point, you are only gaining 15% on that delta/35.
Thank you! In looking at the output from ssa.tools it says my monthly average indexed earnings is $10,136 through 2022 and that the amount above $6,721 is multiplied by the 15% you reference. So in my discussions with my wife, I think the message has to be that although additional work can perhaps bump up my monthly Social Security benefit a little more if we wait until Age 70 to start, the real benefit from additional earnings between now and then would be to provide extra cushion for current expenses and building up our $1 million in retirement savings even more. Is that how you would summarize it?

Regards,

Joe
Yes, continuing to earn gives you income for current spending and for additional retirement savings, vs withdrawing from retirement savings to cover current spending. Waiting until 70 to collect SS increases your (and your spouse's survivor) payment much more than additional SS wages would (if taking it before 70).

I was a SAHM for many years, so very little in SS wages until I started working part-time when the kids were older. I've now got my 40 quarters to be eligible, but my part-time wages are still low, and I'll never reach 35 years of earnings. So my SS PIA will never exceed what I'm entitled to as spousal on my DH's record, even though DH retired early at 55 and won't have future earnings. You could look at my continued payments into FICA as pointless, they won't increase my SS payment at all. I'm not continuing to work to increase my SS payment. DH is the higher earner, we want to maximize his SS payment by waiting to 70 because that nets us the largest payment together (his + mine that depends on his) and the largest survivor payment for whichever of us is left.

I am continuing to work because a) it's still fun (novelty hasn't worn off; DH was burned out); b) we still have one last dependent for a few more years (dependent + low earned income = eligible for max EITC refundable credit); and c) I'm trying to pad my SIMPLE IRA for future state tax benefit (only recently got access, so my pre-tax retirement $$ are low relative to DH the solo breadwinner for much longer). I'm planning to work another 3 or so years - I have to thread a fine needle with FAFSA calculations for the youngest and taking max advantage of EITC, while Roth converting opportunistically in our low income slot. I need *enough* earned income to fully phase in on EITC (so can't fully max my SIMPLE IRA :annoyed ), and then Roth convert only enough to stay in the EFC=0 range for FAFSA and stay below phasing out of EITC (whichever is lowest). Once we are done with FAFSA, and he's no longer a dependent (EITC goes away) we can ramp up Roth conversions, which means earned income would be in the way. We'd like to perform Roth conversions nearly all in the zero bracket (standard deduction) for many years to whittle the tIRA balances down inexpensively. This is another good reason to defer SS until 70 - more time and tax space to do those conversions. If things go as planned, when we do begin SS at 70, we can reduce Roth conversions enough to limit taxation of SS by that *other* income, and when RMDs kick in at 75 they will be no larger than those reduced Roth conversions and replace them.
User avatar
Chip Munk
Posts: 881
Joined: Fri Feb 22, 2019 3:01 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Chip Munk »

smitcat wrote: Sun Jun 04, 2023 1:38 pm
David Jay wrote: Sun Jun 04, 2023 1:04 pm Yes.

For instance, at age 68, if one wants to get an accurate result from opensocialsecurity.com, one needs to use their current PIA, not a PIA from two years ago that did not include the 2022 and 2023 COLAs. You will notice that OpenSocialSecurity has no input for COLA, because COLA is built into the PIA.
I do know that the SS benefits change after FRA - I do not know if the actual PIA changes or if they call the increases something else and keep the PIA at FRA the same.
I believe David Jay is correct that a COLA results in a new, higher PIA. I observed this myself when my husband and I downloaded our SSA statements each January and the PIA shown in the statement had increased by the amount of the COLA, even after we were past FRA.

The SSA webpage "Application of COLA to a Retirement Benefit" https://www.ssa.gov/oact/cola/colaapplic.html states:

Each Social Security benefit is based on a "primary insurance amount," or PIA. The PIA in turn is directly related to the primary beneficiary's earnings through a benefit formula. It is the PIA that is increased by the COLA, with the result truncated to the next lower dime.
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

Chip Munk wrote: Sun Jun 04, 2023 9:55 pm
smitcat wrote: Sun Jun 04, 2023 1:38 pm
David Jay wrote: Sun Jun 04, 2023 1:04 pm Yes.

For instance, at age 68, if one wants to get an accurate result from opensocialsecurity.com, one needs to use their current PIA, not a PIA from two years ago that did not include the 2022 and 2023 COLAs. You will notice that OpenSocialSecurity has no input for COLA, because COLA is built into the PIA.
I do know that the SS benefits change after FRA - I do not know if the actual PIA changes or if they call the increases something else and keep the PIA at FRA the same.
I believe David Jay is correct that a COLA results in a new, higher PIA. I observed this myself when my husband and I downloaded our SSA statements each January and the PIA shown in the statement had increased by the amount of the COLA, even after we were past FRA.

The SSA webpage "Application of COLA to a Retirement Benefit" https://www.ssa.gov/oact/cola/colaapplic.html states:

Each Social Security benefit is based on a "primary insurance amount," or PIA. The PIA in turn is directly related to the primary beneficiary's earnings through a benefit formula. It is the PIA that is increased by the COLA, with the result truncated to the next lower dime.
Thank you - I found it here...
"KEY TAKEAWAYS
The primary insurance amount (PIA) is the amount of Social Security benefits paid to a retiree at full retirement age."
Link...
https://www.investopedia.com/terms/p/pr ... amount.asp
vested1
Posts: 3496
Joined: Wed Jan 04, 2012 3:20 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by vested1 »

careerdata wrote: Sun Jun 04, 2023 6:03 pm

I think there is a much more compelling case for us to delay my starting Social Security until age 70 based but we have to be flexible as things change, and we need to be on the same page regardless of what we end up doing, as the decision will impact the two of us as well as our two children.

Regards,

Joe
Here is the simple argument that I used to convince my wife that I should delay until age 70 (using your numbers and assuming you continue to work). The same percentage of difference applies even if you decide to stop working.

age 62 - $2,471 age 70 - $4,567

"Dear wife, which amount would you prefer to receive from SS every month for the rest of your life if I died at age 70 or older, $2,471 or $4,567?"

Even if you died between age 62 and age 70, every month of your delay would provide a higher monthly benefit for your wife for the rest of her life. This argument also assumes that your wife's benefit amount will not surpass yours in the future. Remember that the survivor gets the higher of the two benefits and loses the lower one.
vested1
Posts: 3496
Joined: Wed Jan 04, 2012 3:20 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by vested1 »

smitcat wrote: Mon Jun 05, 2023 8:35 am
Chip Munk wrote: Sun Jun 04, 2023 9:55 pm
smitcat wrote: Sun Jun 04, 2023 1:38 pm
David Jay wrote: Sun Jun 04, 2023 1:04 pm Yes.

For instance, at age 68, if one wants to get an accurate result from opensocialsecurity.com, one needs to use their current PIA, not a PIA from two years ago that did not include the 2022 and 2023 COLAs. You will notice that OpenSocialSecurity has no input for COLA, because COLA is built into the PIA.
I do know that the SS benefits change after FRA - I do not know if the actual PIA changes or if they call the increases something else and keep the PIA at FRA the same.
I believe David Jay is correct that a COLA results in a new, higher PIA. I observed this myself when my husband and I downloaded our SSA statements each January and the PIA shown in the statement had increased by the amount of the COLA, even after we were past FRA.

The SSA webpage "Application of COLA to a Retirement Benefit" https://www.ssa.gov/oact/cola/colaapplic.html states:

Each Social Security benefit is based on a "primary insurance amount," or PIA. The PIA in turn is directly related to the primary beneficiary's earnings through a benefit formula. It is the PIA that is increased by the COLA, with the result truncated to the next lower dime.
Thank you - I found it here...
"KEY TAKEAWAYS
The primary insurance amount (PIA) is the amount of Social Security benefits paid to a retiree at full retirement age."
Link...
https://www.investopedia.com/terms/p/pr ... amount.asp
I learned this also when my projected numbers didn't agree with yearly statements from SS. Everything is based on PIA, not only COLA, but penalties for filing early, and rewards for delaying. Logically, that is the fairest way to calculate benefits because it eliminates variables.
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

vested1 wrote: Mon Jun 05, 2023 9:09 am
smitcat wrote: Mon Jun 05, 2023 8:35 am
Chip Munk wrote: Sun Jun 04, 2023 9:55 pm
smitcat wrote: Sun Jun 04, 2023 1:38 pm
David Jay wrote: Sun Jun 04, 2023 1:04 pm Yes.

For instance, at age 68, if one wants to get an accurate result from opensocialsecurity.com, one needs to use their current PIA, not a PIA from two years ago that did not include the 2022 and 2023 COLAs. You will notice that OpenSocialSecurity has no input for COLA, because COLA is built into the PIA.
I do know that the SS benefits change after FRA - I do not know if the actual PIA changes or if they call the increases something else and keep the PIA at FRA the same.
I believe David Jay is correct that a COLA results in a new, higher PIA. I observed this myself when my husband and I downloaded our SSA statements each January and the PIA shown in the statement had increased by the amount of the COLA, even after we were past FRA.

The SSA webpage "Application of COLA to a Retirement Benefit" https://www.ssa.gov/oact/cola/colaapplic.html states:

Each Social Security benefit is based on a "primary insurance amount," or PIA. The PIA in turn is directly related to the primary beneficiary's earnings through a benefit formula. It is the PIA that is increased by the COLA, with the result truncated to the next lower dime.
Thank you - I found it here...
"KEY TAKEAWAYS
The primary insurance amount (PIA) is the amount of Social Security benefits paid to a retiree at full retirement age."
Link...
https://www.investopedia.com/terms/p/pr ... amount.asp
I learned this also when my projected numbers didn't agree with yearly statements from SS. Everything is based on PIA, not only COLA, but penalties for filing early, and rewards for delaying. Logically, that is the fairest way to calculate benefits because it eliminates variables.
Yes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA will be adjusted both up and down dependent upon when they elect to file for SS.
backpacker61
Posts: 1613
Joined: Wed May 20, 2020 6:36 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by backpacker61 »

careerdata wrote: Sun Jun 04, 2023 3:02 pm So in my discussions with my wife, I think the message has to be that although additional work can perhaps bump up my monthly Social Security benefit a little more if we wait until Age 70 to start, the real benefit from additional earnings between now and then would be to provide extra cushion for current expenses and building up our $1 million in retirement savings even more. Is that how you would summarize it?
I agree with this.

I went through a lot of spreadsheet machinations over the weekend and figured out that working FT last year increased my PIA by $13/month.
Don't spend it all in one place :?

I agree with you about the value in delaying claiming to age 70.
It could be worth pursuing some gig work if doing that helps you delay filing to age 70, even if it doesn't result in replacing any entries in your 35-entry earnings history.
“Now shall I walk or shall I ride? | 'Ride,' Pleasure said; | 'Walk,' Joy replied.” | | ― W.H. Davies
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

smitcat wrote: Mon Jun 05, 2023 9:19 amYes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA benefit amount will be adjusted both up and down dependent upon when they elect to file for SS.
The benefit is adjusted but the PIA remains the same regardless of when an individual claims.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
User avatar
Chip Munk
Posts: 881
Joined: Fri Feb 22, 2019 3:01 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Chip Munk »

smitcat wrote: Mon Jun 05, 2023 9:19 am Yes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA will be adjusted both up and down dependent upon when they elect to file for SS.
The PIA is not adjusted based on when someone files for benefits. The PIA is the base number used to calculate a person's benefit. It is in the benefit calculation that they account for when the person filed for SS. They also deduct the Medicare Part B premium, then round down to the nearest dollar, then deduct for Part D IRMAA if owed, etc.

ETA: I see David Jay beat me to it!
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

David Jay wrote: Mon Jun 05, 2023 11:02 am
smitcat wrote: Mon Jun 05, 2023 9:19 amYes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA benefit amount will be adjusted both up and down dependent upon when they elect to file for SS.
The benefit is adjusted but the PIA remains the same regardless of when an individual claims.
This is from your post above...
"What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253."
And now this post....
"The benefit is adjusted but the PIA remains the same regardless of when an individual claims."
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

Chip Munk wrote: Mon Jun 05, 2023 11:21 am
smitcat wrote: Mon Jun 05, 2023 9:19 am Yes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA will be adjusted both up and down dependent upon when they elect to file for SS.
The PIA is not adjusted based on when someone files for benefits. The PIA is the base number used to calculate a person's benefit. It is in the benefit calculation that they account for when the person filed for SS. They also deduct the Medicare Part B premium, then round down to the nearest dollar, then deduct for Part D IRMAA if owed, etc.

ETA: I see David Jay beat me to it!
Yes -I got it off the linked site.
Should have said the PIA benefit amount will adjust based on file date not the PIA amount itself.
User avatar
Chip Munk
Posts: 881
Joined: Fri Feb 22, 2019 3:01 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Chip Munk »

smitcat wrote: Mon Jun 05, 2023 11:26 am
Chip Munk wrote: Mon Jun 05, 2023 11:21 am
smitcat wrote: Mon Jun 05, 2023 9:19 am Yes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA will be adjusted both up and down dependent upon when they elect to file for SS.
The PIA is not adjusted based on when someone files for benefits. The PIA is the base number used to calculate a person's benefit. It is in the benefit calculation that they account for when the person filed for SS. They also deduct the Medicare Part B premium, then round down to the nearest dollar, then deduct for Part D IRMAA if owed, etc.

ETA: I see David Jay beat me to it!
Yes -I got it off the linked site.
Should have said the PIA benefit amount will adjust based on file date not the PIA amount itself.
Change "PIA benefit amount" to just "benefit amount" and I'll agree with you. The PIA and the benefit are two different things. There is no such thing as the "PIA benefit amount".
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

Chip Munk wrote: Mon Jun 05, 2023 11:29 am
smitcat wrote: Mon Jun 05, 2023 11:26 am
Chip Munk wrote: Mon Jun 05, 2023 11:21 am
smitcat wrote: Mon Jun 05, 2023 9:19 am Yes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA will be adjusted both up and down dependent upon when they elect to file for SS.
The PIA is not adjusted based on when someone files for benefits. The PIA is the base number used to calculate a person's benefit. It is in the benefit calculation that they account for when the person filed for SS. They also deduct the Medicare Part B premium, then round down to the nearest dollar, then deduct for Part D IRMAA if owed, etc.

ETA: I see David Jay beat me to it!
Yes -I got it off the linked site.
Should have said the PIA benefit amount will adjust based on file date not the PIA amount itself.
Change "PIA benefit amount" to just "benefit amount" and I'll agree with you. The PIA and the benefit are two different things. There is no such thing as the "PIA benefit amount".
As you wish.
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

smitcat wrote: Mon Jun 05, 2023 11:23 am
David Jay wrote: Mon Jun 05, 2023 11:02 am
smitcat wrote: Mon Jun 05, 2023 9:19 amYes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA benefit amount will be adjusted both up and down dependent upon when they elect to file for SS.
The benefit is adjusted but the PIA remains the same regardless of when an individual claims.
This is from your post above...
"What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253."
And now this post....
"The benefit is adjusted but the PIA remains the same regardless of when an individual claims."
I was focused on the language highlight in red. Filing early or late does not change the PIA (it most certainly changes the benefit amount). One's PIA is fixed at age 62 and only changes by the amount of the COLA (or additional work history, if any) each year. The difference between my 2022 benefit and my 2023 benefit is exactly the amount of the 2023 COLA.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

David Jay wrote: Mon Jun 05, 2023 11:31 am
smitcat wrote: Mon Jun 05, 2023 11:23 am
David Jay wrote: Mon Jun 05, 2023 11:02 am
smitcat wrote: Mon Jun 05, 2023 9:19 amYes - I see that now thank you. I am attempting to help someone else figure this out right now so very timely. PIA is the calculated number for a person's SS at FRA ... and PIA benefit amount will be adjusted both up and down dependent upon when they elect to file for SS.
The benefit is adjusted but the PIA remains the same regardless of when an individual claims.
This is from your post above...
"What most people do not realize is that one's PIA changes every year (beginning at age 63) with the annual COLA. So even though I'm retired (there will be no additional work years) and well over age 63, my PIA changes every year. My 2022 PIA was $2993 and my 2023 PIA is $3253."
And now this post....
"The benefit is adjusted but the PIA remains the same regardless of when an individual claims."
I was focused on the language highlight in red. Filing early or late does not change the PIA (it most certainly changes the benefit amount). One's PIA is fixed at age 62 and only changes by the amount of the COLA (or additional work history, if any) each year. The difference between my 2022 benefit and my 2023 benefit is exactly the amount of the 2023 COLA.
The original question(s) involve using opensocialsecurity as a tool.
With that in mind ...when someone gets past their FRA what amount goes into the opensocialsecurity calculator in the "PIA" box and where can someone look up that number on the SS.gov site?
I have their SS statement and there is no PIA on it.
User avatar
Chip Munk
Posts: 881
Joined: Fri Feb 22, 2019 3:01 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Chip Munk »

smitcat wrote: Mon Jun 05, 2023 11:41 am The original question(s) involve using opensocialsecurity as a tool.
With that in mind ...when someone gets past their FRA what amount goes into the opensocialsecurity calculator in the "PIA" box and where can someone look up that number on the SS.gov site?
I have their SS statement and there is no PIA on it.
If they are past FRA, look for a line in their SSA statement for the Spousal Benefit that someone could claim on their record. Multiply by two to get this person's PIA.
ETA: Spousal benefit is not shown on the SSA statement. Spouse's Survivor Benefit is shown and, in my case at least, is equal to my PIA even though I am past FRA, have earned DRCs and would expect spouse's survivor benefit to equal my current benefit. So, look for the line item "Spouse, if benefits start at full retirement age" under "Survivors Benefits" and that may be the PIA. Cross check it against the age 70 benefit.

Cross check it by this calculation: Look for the age 70 benefit. Divide by the appropriate divisor based on the maximum DRCs they would earn at age 70: 1 + (Max DRCs) * 0.08/12

For example, if their FRA is 66 (maximum 48 DRCs): (Age 70 benefit) / 1.32
If FRA is 67 (36 max DRCs): (Age 70 benefit) / 1.24

If their FRA is in between those values, figure out the maximum DRCs they would earn by waiting until age 70 to claim and use the formula.
Last edited by Chip Munk on Mon Jun 05, 2023 12:30 pm, edited 1 time in total.
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

Chip Munk wrote: Mon Jun 05, 2023 11:51 am
smitcat wrote: Mon Jun 05, 2023 11:41 am The original question(s) involve using opensocialsecurity as a tool.
With that in mind ...when someone gets past their FRA what amount goes into the opensocialsecurity calculator in the "PIA" box and where can someone look up that number on the SS.gov site?
I have their SS statement and there is no PIA on it.
If they are past FRA, look for a line in their SSA statement for the Spousal Benefit that someone could claim on their record. Multiply by two to get this person's PIA.

Cross check it by this calculation: Look for the age 70 benefit. Divide by the appropriate divisor based on the maximum DRCs they would earn at age 70: 1 + (Max DRCs) * 0.08/12

For example, if their FRA is 66 (maximum 48 DRCs): (Age 70 benefit) / 1.32
If FRA is 67 (36 max DRCs): (Age 70 benefit) / 1.24

If their FRA is in between those values, figure out the maximum DRCs they would earn by waiting until age 70 to claim and use the formula.
Thank you very much.
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

Chip Munk wrote: Mon Jun 05, 2023 11:51 am
smitcat wrote: Mon Jun 05, 2023 11:41 am The original question(s) involve using opensocialsecurity as a tool.
With that in mind ...when someone gets past their FRA what amount goes into the opensocialsecurity calculator in the "PIA" box and where can someone look up that number on the SS.gov site?
I have their SS statement and there is no PIA on it.
If they are past FRA, look for a line in their SSA statement for the Spousal Benefit that someone could claim on their record. Multiply by two to get this person's PIA.

Cross check it by this calculation: Look for the age 70 benefit. Divide by the appropriate divisor based on the maximum DRCs they would earn at age 70: 1 + (Max DRCs) * 0.08/12

For example, if their FRA is 66 (maximum 48 DRCs): (Age 70 benefit) / 1.32
If FRA is 67 (36 max DRCs): (Age 70 benefit) / 1.24

If their FRA is in between those values, figure out the maximum DRCs they would earn by waiting until age 70 to claim and use the formula.
From SS statement,
Survivor benefits...
minor child - $2,483
Spouse (if caring for child) - $2,483
Spouse at full retirement age - $3,311
I cannot see using any of these multiplied by 2 to fill in the PIA number - these would be too large. ($5,000+)
User avatar
Chip Munk
Posts: 881
Joined: Fri Feb 22, 2019 3:01 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Chip Munk »

smitcat wrote: Mon Jun 05, 2023 12:04 pm
Chip Munk wrote: Mon Jun 05, 2023 11:51 am
smitcat wrote: Mon Jun 05, 2023 11:41 am The original question(s) involve using opensocialsecurity as a tool.
With that in mind ...when someone gets past their FRA what amount goes into the opensocialsecurity calculator in the "PIA" box and where can someone look up that number on the SS.gov site?
I have their SS statement and there is no PIA on it.
If they are past FRA, look for a line in their SSA statement for the Spousal Benefit that someone could claim on their record. Multiply by two to get this person's PIA.
ETA: Spousal benefit is not shown on the SSA statement. Spouse's Survivor Benefit is shown and, in my case at least, is equal to my PIA even though I am past FRA, have earned DRCs and would expect spouse's survivor benefit to equal my current benefit. So, look for the line item "Spouse, if benefits start at full retirement age" under "Survivors Benefits" and that may be the PIA. Cross check it against the age 70 benefit.

Cross check it by this calculation: Look for the age 70 benefit. Divide by the appropriate divisor based on the maximum DRCs they would earn at age 70: 1 + (Max DRCs) * 0.08/12

For example, if their FRA is 66 (maximum 48 DRCs): (Age 70 benefit) / 1.32
If FRA is 67 (36 max DRCs): (Age 70 benefit) / 1.24

If their FRA is in between those values, figure out the maximum DRCs they would earn by waiting until age 70 to claim and use the formula.
Thank you very much.
I need to correct something I posted above. SSA statements have changed over time and while I was sure I had seen a Spousal Benefit listed, looking at a more recent statement it doesn't include one. It does list a Survivor benefit for a spouse and curiously, it lists my PIA there, despite the fact that I'm past FRA and have earned DRCs that should make that spousal survivor benefit higher than my PIA.

So if you see a line item for "Spouse, if benefits start at full retirement age" under "Survivors Benefits", that just might be the PIA. Cross check it against the age 70 benefit to be sure.

SSA statements confusing and it doesn't help that the one piece of information you need (the PIA) is no longer listed on the statement once you are past FRA !
Last edited by Chip Munk on Mon Jun 05, 2023 12:31 pm, edited 1 time in total.
User avatar
Chip Munk
Posts: 881
Joined: Fri Feb 22, 2019 3:01 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Chip Munk »

smitcat wrote: Mon Jun 05, 2023 12:19 pm From SS statement,
Survivor benefits...
minor child - $2,483
Spouse (if caring for child) - $2,483
Spouse at full retirement age - $3,311
I cannot see using any of these multiplied by 2 to fill in the PIA number - these would be too large. ($5,000+)
We cross posted. See my post above -- the Spousal Benefit I mentioned is not on the SSA statement after all. The Spouse's Survivor Benefit that is shown may be the PIA.

What is this person's age 70 benefit and what is their FRA? We can cross check the number that way.
smitcat
Posts: 13300
Joined: Mon Nov 07, 2016 9:51 am

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by smitcat »

Chip Munk wrote: Mon Jun 05, 2023 12:23 pm
smitcat wrote: Mon Jun 05, 2023 12:19 pm From SS statement,
Survivor benefits...
minor child - $2,483
Spouse (if caring for child) - $2,483
Spouse at full retirement age - $3,311
I cannot see using any of these multiplied by 2 to fill in the PIA number - these would be too large. ($5,000+)
We cross posted. See my post above -- the Spousal Benefit I mentioned is not on the SSA statement after all. The Spouse's Survivor Benefit that is shown may be the PIA.

What is this person's age 70 benefit and what is their FRA? We can cross check the number that way.
From their SS statement printed on Jan 16th 2023...
FRA is 66 and 2 months
Age 70 benefit est - $4,326
RyeBourbon
Posts: 1219
Joined: Tue Sep 01, 2020 12:20 pm
Location: Delaware/Philly

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by RyeBourbon »

smitcat wrote: Mon Jun 05, 2023 12:36 pm
Chip Munk wrote: Mon Jun 05, 2023 12:23 pm
smitcat wrote: Mon Jun 05, 2023 12:19 pm From SS statement,
Survivor benefits...
minor child - $2,483
Spouse (if caring for child) - $2,483
Spouse at full retirement age - $3,311
I cannot see using any of these multiplied by 2 to fill in the PIA number - these would be too large. ($5,000+)
We cross posted. See my post above -- the Spousal Benefit I mentioned is not on the SSA statement after all. The Spouse's Survivor Benefit that is shown may be the PIA.

What is this person's age 70 benefit and what is their FRA? We can cross check the number that way.
From their SS statement printed on Jan 16th 2023...
FRA is 66 and 2 months
Age 70 benefit est - $4,326
Based on the age 70 benefit of $4,326 and 46 months of delayed credits, it looks like $3,311 would be the PIA.
Retired June 2023. AA = 55/35/10
User avatar
Chip Munk
Posts: 881
Joined: Fri Feb 22, 2019 3:01 pm

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by Chip Munk »

RyeBourbon wrote: Mon Jun 05, 2023 12:40 pm
smitcat wrote: Mon Jun 05, 2023 12:36 pm
Chip Munk wrote: Mon Jun 05, 2023 12:23 pm
smitcat wrote: Mon Jun 05, 2023 12:19 pm From SS statement,
Survivor benefits...
minor child - $2,483
Spouse (if caring for child) - $2,483
Spouse at full retirement age - $3,311
I cannot see using any of these multiplied by 2 to fill in the PIA number - these would be too large. ($5,000+)
We cross posted. See my post above -- the Spousal Benefit I mentioned is not on the SSA statement after all. The Spouse's Survivor Benefit that is shown may be the PIA.

What is this person's age 70 benefit and what is their FRA? We can cross check the number that way.
From their SS statement printed on Jan 16th 2023...
FRA is 66 and 2 months
Age 70 benefit est - $4,326
Based on the age 70 benefit of $4,326 and 46 months of delayed credits, it looks like $3,311 would be the PIA.
Yes! It's interesting that the stated Survivor benefit for the spouse does not reflect the DRCs earned to date since the survivor benefit is supposed to equal the benefit the SS recipient would have been entitled to as of the date they passed.

At least now there is an easy way for those past their FRA to look up their PIA. I would still cross check it against the age 70 benefit just to be sure -- you never know when/if they might change the survivor benefit calculation to reflect earned DRCs.
User avatar
David Jay
Posts: 14586
Joined: Mon Mar 30, 2015 5:54 am
Location: Michigan

Re: Help With Projecting Growth of Social Security PIA at Age 70

Post by David Jay »

Chip Munk wrote: Mon Jun 05, 2023 1:01 pmIt's interesting that the stated Survivor benefit for the spouse does not reflect the DRCs earned to date since the survivor benefit is supposed to equal the benefit the SS recipient would have been entitled to as of the date they passed.
Between FRA and age 70, DRCs are applied once a year at the same time as the COLA. No increase in DRC benefit will be shown on the website until January of 2024.

This even applies to claiming benefits. After FRA (and before age 70), if you claim in June you will only receive a benefit equal to the amount of one's December 2022 DRCs for the remaining 6 months of 2023. In January 2024 you will receive the benefit increase from the additional DRCs from 2023.

At age 70 one immediately receives all DRCs in the first benefit deposit. Why the difference? I have no idea.
It's not an engineering problem - Hersh Shefrin | To get the "risk premium", you really do have to take the risk - nisiprius
Post Reply