Social Security Launches New Online Retirement Estimator

By Jon Flynn

Probably the most difficult question that a person heading into their retirement years will face is exactly when to start receiving social security benefits.  Common questions I often hear asked are, “Should I retire from my job at 62 or would it be better if I wait until 65?” or, “What if I’m healthy enough, should I wait until I’m 70?”  Getting answers to these types of questions just got much better because on July 21, 2008 the Social Security Administration unveiled a terrific new online tool that now makes it easier to try and come up with the right answer.  You can find the free calculator at www.socialsecurity.gov/estimator.

The release of this Internet tool was born out of a desire by the social security administration to provide better and more reliable information to pre-retirees than a once-a-year paper estimate can provide.  The paper estimate is based on a static assumption that a working individual will continue going down a similar earnings path as they have in the past.  But for most of us, we live in a world of ever-changing circumstances.  And when things change, our retirement payouts can change as well.

For example, let’s say that you expect to make considerably more income over the final ten years of your working years.  This is common, because for many of us, we are just hitting our peak earnings years in our fifties, and even in our sixties for some.  To adjust for this, all you have to do is enter into the online calculator’s questionnaire an estimate of those increased expected earnings.  Your past earnings are already automatically recorded for you.  Once you click “submit” you can immediately see how your monthly payout at various ages will change. Powerful stuff, because unlike the paper estimate, the results are dynamic, not static. 

Considering how much we pay into the social security program over our working years – it’s only logical that we would want to be sure and max out what we receive back.  You may find yourself quite surprised at how the little changes you make in your pre-retirement years can have a big impact on your financial future.

Everybody’s situation is different and arriving at solutions can get complicated.  So always consult with financial, legal, and tax professionals before making any decisions.

Jon Flynn is a Certified Financial Planner ^TM and owner of Flynn Financial in Eynon. He is a Representative of Securities America, Inc., Member FINRA/SIPC and of Securities America Advisors, Inc. Flynn Financial and Securities America are unaffiliated.   Mr. Flynn can be reached at 570-876-5015.