We all know that if we work hard and pay our taxes (including Social Security and Medicare), we will be entitled to Social Security retirement benefits eventually. But as we have stressed in previous articles, you need to determine how much you will likely get from your Social Security benefits in order to do effective retirement planning. The best way to estimate your benefits is using the Social Security retirement calculator available at the SSA website. Armed with this knowledge you can determine the best time to apply for Social Security to get the most out of your retirement.
One of the best places to stop by first of all is the official SSA site. Their Online Retirement Estimator (Publication No. 05-10510) is at https://www.socialsecurity.gov/estimator. The official Social Security retirement calculator will provide a pretty accurate estimate of you entitlements. In addition, it can give you varying scenarios you may want to consider in your retirement planning. These may include applying for retirement early or a change in employment earnings and contributions.
The Social Security retirement estimator is very easy to use. For a start it uses your own personal information that is in it’s system for its calculations. There are obviously limits on how much you can rely on the information. You might change jobs or become unemployed for example. But brilliantly it does make adjustments for inflation as well.
There are some circumstances where you won’t be able to use this Social security retirement calculator though. For example, if you do not have enough Social Security credits to qualify for benefits at the time you want to do the calculations it won’t be very accurate. It will also not work if you are already collecting Social Security benefits yourself or on another persons record.
An additional benefit of the Social Security calculator is that it will also give estimates and information on your Medicare benefits, another important consideration when you are planning for retirement.
Besides the official Social Security retirement calculator, you can go to www.mymoney.gov for additional helpful information and worksheets. These worksheets, together with related advice provide a means to look at the various other investment options to top up or increase your overall retirement fund as well as estimating your monetary retirement needs.
So before you even consider applying for Social Security for retirement you must use the Social Security retirement calculator to see if you should at that point. The earlier you see the possible outcomes, the earlier you will be able to adjust your plans.