A new and more useful Social Security benefits calculator


A colleague recently sent me a WSJ article covering a new calculator on the Social Security’s administration’s web site that gives a much-improved picture of what social security benefits could look like in retirement. This calculator is all part of a major upgrade of the Social Security Administration’s systems and website to provide a faster and easier way to file for Social Security benefits online. Here are some key points from the article that talk about this tool:

The Retirement Estimator addresses a number of shortcomings with previous calculators and gives users, within minutes, a reasonably accurate estimate of future benefits. The new tool has three big advantages.

  • First, the estimate is tied to your actual earnings history. Once you have identified yourself online, the calculator looks for your past annual earnings in the Social Security database and uses those numbers to estimate your benefit. In short: no more typing in dozens of years of earnings (although you will have to enter your earnings for the most recent calendar year).

  • Second, the new calculator allows users to type in an average salary for their remaining years of work — which is valuable if you expect your wages to jump sharply or if you plan to cut back to part-time work.

  • Finally, the agency’s new tool allows you to consider and run the numbers for various “stop work” ages. (Again, the annual mailing assumes you will stop working at one of three ages — 62, full retirement age, or 70.) Want to know what your benefit will be if you stop working at age 58 — or 64? The calculator displays as many as three results on a single page.

The new tool has a few limitations of its own. Some people, including individuals who are already collecting Social Security benefits, can’t make use of the calculator. And you can’t use it to calculate spousal benefits. For most people, though, the tool offers a “much more realistic estimate of your Social Security benefits,” says Mark Lassiter, an agency spokesman. The agency still plans to mail its annual estimates, he notes.

I found the tool/estimator quite straightforward to use and the numbers looked more accurate than some of my past statement estimates. However as the website states, this is an estimate and not an absolute figure. Besides, if forecasts for social security funding are correct by the time most of us in our 20’s, 30’s and even 40’s retire there may not be much left in the social security bucket for us.

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2 Comments on "A new and more useful Social Security benefits calculator"

[…] your Social Security retirement benefit payments are based on how much you earned while you worked, higher lifetime earnings will result in a higher […]

[…] tool on the Social Security Administration’s Web site, ssa.gov, can help users estimate benefit […]


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