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canyonwalkerLike a lot of people in the US I got an email message recently from the Social Security Administration (SSA) that their login process has changed and I would need to set up my new credentials. BTW, it's not a scam or phishing attempt; it's a real thing. And yes, I have an online Social Security account.
...No, I'm not earning Social Security. I'm still probably umpteen years from filing for benefits. But I created an account on their website many years ago because I'm curious about the money I've been paying in to the system since my first paycheck job at age 15.
The need to set up new login credentials for SSA was my prompt to visit the site to figure out the answer to a question I've been wondering about for some time now. What would my SS payments look like at regular retirement age if I retired early vs. worked several more years? I thought I'd have to poke around the site to and do a lot of numerical modeling on my own to answer that. To my pleasant surprise SSA now has a retirement calculator right there on the main page after logging in that can answer that question.
This chart shows the SS payments I'd earn, estimated, umpteen years from now if I stopped working— i.e., stopped paying in to the system— today. Actually, it's an estimate if I stopped paying in as of 12/31/2023, so I'm already a bit ahead of these forecasts with work and payments in 2024. The key is that value shown in blue in the middle drop-down box above the graph. I put in zero as my future annual salary. Already I've got a decent estimate benefit coming my way in the future.
To model out the difference between retiring early (in my early 50s) and continuing to work several more years I also put a larger number in that middle drop-down box. The difference if I work another several years, maxing out my SS benefit, is... not huge. I mean, it's also not trivial. I'm not including the second chart here, but the difference was about $300 a month if I file at first eligibility at age 62 and $500 a month if I want until the Full Retirement Age of 67. An extra few hundred a month is nothing to sneeze at... but it's also not a game-changer relative to the size of the benefit I've already earned.
What this exercise tells me is that even if I choose to stop working soon, in my early 50s, I've got a decent social security benefit waiting for me years down the road, thanks to what I've already paid into the system.
...No, I'm not earning Social Security. I'm still probably umpteen years from filing for benefits. But I created an account on their website many years ago because I'm curious about the money I've been paying in to the system since my first paycheck job at age 15.
The need to set up new login credentials for SSA was my prompt to visit the site to figure out the answer to a question I've been wondering about for some time now. What would my SS payments look like at regular retirement age if I retired early vs. worked several more years? I thought I'd have to poke around the site to and do a lot of numerical modeling on my own to answer that. To my pleasant surprise SSA now has a retirement calculator right there on the main page after logging in that can answer that question.
This chart shows the SS payments I'd earn, estimated, umpteen years from now if I stopped working— i.e., stopped paying in to the system— today. Actually, it's an estimate if I stopped paying in as of 12/31/2023, so I'm already a bit ahead of these forecasts with work and payments in 2024. The key is that value shown in blue in the middle drop-down box above the graph. I put in zero as my future annual salary. Already I've got a decent estimate benefit coming my way in the future.
To model out the difference between retiring early (in my early 50s) and continuing to work several more years I also put a larger number in that middle drop-down box. The difference if I work another several years, maxing out my SS benefit, is... not huge. I mean, it's also not trivial. I'm not including the second chart here, but the difference was about $300 a month if I file at first eligibility at age 62 and $500 a month if I want until the Full Retirement Age of 67. An extra few hundred a month is nothing to sneeze at... but it's also not a game-changer relative to the size of the benefit I've already earned.
What this exercise tells me is that even if I choose to stop working soon, in my early 50s, I've got a decent social security benefit waiting for me years down the road, thanks to what I've already paid into the system.
