Social Security: Website Estimate vs Actual

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills
Post Reply
Topic Author
dcop
Posts: 217
Joined: Fri Sep 08, 2017 6:06 pm

Social Security: Website Estimate vs Actual

Post by dcop »

For those of you that have started receiving your benefits I'm curious how close the estimate was compared to the actual amount when you committed to start your payments.
montanagirl
Posts: 1441
Joined: Thu Nov 19, 2009 4:55 pm
Location: Montana

Re: Social Security: Website Estimate vs Actual

Post by montanagirl »

Mine was right on.

But I downloaded the anypia program from the site and kept it updated
mikeast
Posts: 151
Joined: Mon Jul 02, 2007 11:13 am

Re: Social Security: Website Estimate vs Actual

Post by mikeast »

Got my first SS Check this past August. It was spot on in accordance with the estimate on their website. I expected less as
the the calculators indicated about $100 less than the estimate. So, it was a nice little surprise.
User avatar
spdoublebass
Posts: 755
Joined: Thu Apr 27, 2017 10:04 pm
Location: NY

Re: Social Security: Website Estimate vs Actual

Post by spdoublebass »

What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
I'm trying to think, but nothing happens
Topic Author
dcop
Posts: 217
Joined: Fri Sep 08, 2017 6:06 pm

Re: Social Security: Website Estimate vs Actual

Post by dcop »

spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
Even if you retired at 42 you still wouldn't know future COLA's, so no it wouldn't be possible to be accurate that far from being eligible.
User avatar
neurosphere
Posts: 3910
Joined: Sun Jan 17, 2010 1:55 pm

Re: Social Security: Website Estimate vs Actual

Post by neurosphere »

spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
Social security estimates assume (among other things) that both wage inflation and price inflation will be zero between now and when you collect a benefit. So even if they estimate your future earnings accurately, the benefit will be off depending on how from from "zero" the wage index and CPI will be each year.
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes".
RyeBourbon
Posts: 262
Joined: Tue Sep 01, 2020 12:20 pm
Location: NJ/Philly

Re: Social Security: Website Estimate vs Actual

Post by RyeBourbon »

neurosphere wrote: Sat Oct 03, 2020 6:32 am
spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
Social security estimates assume (among other things) that both wage inflation and price inflation will be zero between now and when you collect a benefit. So even if they estimate your future earnings accurately, the benefit will be off depending on how from from "zero" the wage index and CPI will be each year.
So is it fair to say that the benefit shown for, say 2030, is in current 2020 dollars?
User avatar
22twain
Posts: 2649
Joined: Thu May 10, 2012 5:42 pm

Re: Social Security: Website Estimate vs Actual

Post by 22twain »

RyeBourbon wrote: Sat Oct 03, 2020 9:36 am So is it fair to say that the benefit shown for, say 2030, is in current 2020 dollars?
Yes, at least as an approximation.

Just make sure the benefit estimate corresponds to your actual or expected earnings history. If you're you're going to stop working at age 55, don't use an estimate that assumes you're going to keep working until your SS "full retirement age" (67 or whatever).
Help save endangered words! When you write "princiPLE", make sure you don't really mean "princiPAL"!
User avatar
neurosphere
Posts: 3910
Joined: Sun Jan 17, 2010 1:55 pm

Re: Social Security: Website Estimate vs Actual

Post by neurosphere »

RyeBourbon wrote: Sat Oct 03, 2020 9:36 am
neurosphere wrote: Sat Oct 03, 2020 6:32 am
spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
Social security estimates assume (among other things) that both wage inflation and price inflation will be zero between now and when you collect a benefit. So even if they estimate your future earnings accurately, the benefit will be off depending on how from from "zero" the wage index and CPI will be each year.
So is it fair to say that the benefit shown for, say 2030, is in current 2020 dollars?
Yes and no. If one assumes that inflation(s) will be zero, 2020 dollars are the SAME as 2030 dollars.

If wages increase on average between now and then, your benefit will go "up" compared to today. But if price inflation increases on average between now and age 62, your benefit will go "down" in terms of today's dollars.

Let's just say that unless you enter your own assumptions for wage and price growth, the SS estimate is really not accurate if you are a ways out from collecting. Or put another way, it's as accurate as any other set of assumptions one might use.
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes".
User avatar
JoeRetire
Posts: 6646
Joined: Tue Jan 16, 2018 2:44 pm

Re: Social Security: Website Estimate vs Actual

Post by JoeRetire »

spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
How good are any 20 year old estimates of anything? And why would you care?
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
liberty53
Posts: 78
Joined: Sat Oct 18, 2014 7:31 am
Location: Boston Area

Re: Social Security: Website Estimate vs Actual

Post by liberty53 »

neurosphere wrote: Sat Oct 03, 2020 1:06 pm
RyeBourbon wrote: Sat Oct 03, 2020 9:36 am
neurosphere wrote: Sat Oct 03, 2020 6:32 am
spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
Social security estimates assume (among other things) that both wage inflation and price inflation will be zero between now and when you collect a benefit. So even if they estimate your future earnings accurately, the benefit will be off depending on how from from "zero" the wage index and CPI will be each year.
So is it fair to say that the benefit shown for, say 2030, is in current 2020 dollars?
Yes and no. If one assumes that inflation(s) will be zero, 2020 dollars are the SAME as 2030 dollars.

If wages increase on average between now and then, your benefit will go "up" compared to today. But if price inflation increases on average between now and age 62, your benefit will go "down" in terms of today's dollars.

Let's just say that unless you enter your own assumptions for wage and price growth, the SS estimate is really not accurate if you are a ways out from collecting. Or put another way, it's as accurate as any other set of assumptions one might use.
Not sure that's correct. By law, social security benefits are indexed for inflation. I believe therefore that the benefit calculated should be in "real" dollar terms. Of course, how the government calculates inflation and changes in real buying power may not be in sync, but an adjustment to benefits will occur if official inflation occurs.
User avatar
neurosphere
Posts: 3910
Joined: Sun Jan 17, 2010 1:55 pm

Re: Social Security: Website Estimate vs Actual

Post by neurosphere »

liberty53 wrote: Sat Oct 03, 2020 1:15 pm
neurosphere wrote: Sat Oct 03, 2020 1:06 pm
RyeBourbon wrote: Sat Oct 03, 2020 9:36 am
neurosphere wrote: Sat Oct 03, 2020 6:32 am
spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
Social security estimates assume (among other things) that both wage inflation and price inflation will be zero between now and when you collect a benefit. So even if they estimate your future earnings accurately, the benefit will be off depending on how from from "zero" the wage index and CPI will be each year.
So is it fair to say that the benefit shown for, say 2030, is in current 2020 dollars?
Yes and no. If one assumes that inflation(s) will be zero, 2020 dollars are the SAME as 2030 dollars.

If wages increase on average between now and then, your benefit will go "up" compared to today. But if price inflation increases on average between now and age 62, your benefit will go "down" in terms of today's dollars.

Let's just say that unless you enter your own assumptions for wage and price growth, the SS estimate is really not accurate if you are a ways out from collecting. Or put another way, it's as accurate as any other set of assumptions one might use.
Not sure that's correct. By law, social security benefits are indexed for inflation. I believe therefore that the benefit calculated should be in "real" dollar terms. Of course, how the government calculates inflation and changes in real buying power may not be in sync, but an adjustment to benefits will occur if official inflation occurs.
What part is not correct? Perhaps you and I are answering different questions. (Highly simplified), between now and age 60, your benefit is determined (among other things) inflation in WAGES. From 62 onwards, your benefit is adjusted based on inflation of PRICES. That's true.

But SS used estimates of ZERO for both wage inflation and price inflation when calculating your SS estimate as shown in your benefit statements. So with that assumption, today's dollars are the SAME at tomorrow's dollars. Which will not be true if one uses any other set of assumptions for price or wage inflation.

So the most accurate answer to the question whether the estimate is in today's dollars or tomorrow's dollars is they are in BOTH tomorrow and today's dollars, given their inflation estimates.
If you have to ask "Is a Target Date fund right for me?", the answer is "Yes".
Morgan Dollar 1921
Posts: 217
Joined: Tue Jul 17, 2018 9:04 am

Re: Social Security: Website Estimate vs Actual

Post by Morgan Dollar 1921 »

Mine were right on the money for age 62, then adjusted upward for my earnings that year to May, another $9 a month. I suggest everyone check their earnings record annually, I had one year that was 10 percent of my actual. A decimal point error more than likely, I had no proof to change some 20 + years later.
User avatar
oldcomputerguy
Moderator
Posts: 9895
Joined: Sun Nov 22, 2015 6:50 am
Location: In the middle of five acres of woods in East Tennessee

Re: Social Security: Website Estimate vs Actual

Post by oldcomputerguy »

Morgan Dollar 1921 wrote: Sat Oct 03, 2020 1:25 pm Mine were right on the money for age 62, then adjusted upward for my earnings that year to May, another $9 a month. I suggest everyone check their earnings record annually, I had one year that was 10 percent of my actual. A decimal point error more than likely, I had no proof to change some 20 + years later.
Definitely a good idea. When I started to check on my projected benefit (and my wife's as well) prior to retiring, I discovered that her employer during the early 1980's completely failed to report some years of her earnings to the SSA. Fortunately we still had her W2's from the affected time period and were able to document the discrepancy to the SSA, and they corrected the error.
Morgan Dollar 1921
Posts: 217
Joined: Tue Jul 17, 2018 9:04 am

Re: Social Security: Website Estimate vs Actual

Post by Morgan Dollar 1921 »

oldcomputerguy wrote: Sat Oct 03, 2020 1:40 pm
Morgan Dollar 1921 wrote: Sat Oct 03, 2020 1:25 pm Mine were right on the money for age 62, then adjusted upward for my earnings that year to May, another $9 a month. I suggest everyone check their earnings record annually, I had one year that was 10 percent of my actual. A decimal point error more than likely, I had no proof to change some 20 + years later.
Definitely a good idea. When I started to check on my projected benefit (and my wife's as well) prior to retiring, I discovered that her employer during the early 1980's completely failed to report some years of her earnings to the SSA. Fortunately we still had her W2's from the affected time period and were able to document the discrepancy to the SSA, and they corrected the error.
You were lucky, you had proof, was the unreported earnings due to oversight or criminal avoidance, if you care to answer.
Grasshopper
Posts: 1081
Joined: Sat Oct 09, 2010 3:52 pm

Re: Social Security: Website Estimate vs Actual

Post by Grasshopper »

Retired at age 54, was worried about 8 years of goose eggs before claiming at 62. Used the SS calculator, and zeroed the remaining years. Came out better with COLA adjustments..
User avatar
oldcomputerguy
Moderator
Posts: 9895
Joined: Sun Nov 22, 2015 6:50 am
Location: In the middle of five acres of woods in East Tennessee

Re: Social Security: Website Estimate vs Actual

Post by oldcomputerguy »

Morgan Dollar 1921 wrote: Sat Oct 03, 2020 1:51 pm You were lucky, you had proof, was the unreported earnings due to oversight or criminal avoidance, if you care to answer.
I have an opinion, However, it's been almost 40 years, her employer is most likely deceased by now, let's leave it to the past.
Morgan Dollar 1921
Posts: 217
Joined: Tue Jul 17, 2018 9:04 am

Re: Social Security: Website Estimate vs Actual

Post by Morgan Dollar 1921 »

oldcomputerguy wrote: Sat Oct 03, 2020 4:05 pm
Morgan Dollar 1921 wrote: Sat Oct 03, 2020 1:51 pm You were lucky, you had proof, was the unreported earnings due to oversight or criminal avoidance, if you care to answer.
I have an opinion, However, it's been almost 40 years, her employer is most likely deceased by now, let's leave it to the past.
I know of another employer whose employees found the same issues. My words, "if you care to answer" were intended to let you respond with a none answer or not at all.
It is none of my business and is left to the past. Best Regards 8-)
User avatar
spdoublebass
Posts: 755
Joined: Thu Apr 27, 2017 10:04 pm
Location: NY

Re: Social Security: Website Estimate vs Actual

Post by spdoublebass »

JoeRetire wrote: Sat Oct 03, 2020 1:13 pm
spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
How good are any 20 year old estimates of anything? And why would you care?
I don't really. I created an account just to make sure my income is posted correctly. Creating an account also takes care of somebody else opening an account in your name (identity theft). When I created an account I noticed it gives me a projected amount for 62, 67, and 70.

I also want to know when I pass the first and second bend points.
I'm trying to think, but nothing happens
User avatar
Peter Foley
Posts: 5205
Joined: Fri Nov 23, 2007 10:34 am
Location: Lake Wobegon

Re: Social Security: Website Estimate vs Actual

Post by Peter Foley »

Mine was right on.

The only thing I did not know was on what day of the month the payment would be made. I did not research that aspect of SS benefit payments.
summerof42
Posts: 187
Joined: Wed Nov 12, 2014 12:33 am

Re: Social Security: Website Estimate vs Actual

Post by summerof42 »

How does one know or determine their bend points?

I’m leery about downloading a file off the net.
User avatar
spdoublebass
Posts: 755
Joined: Thu Apr 27, 2017 10:04 pm
Location: NY

Re: Social Security: Website Estimate vs Actual

Post by spdoublebass »

summerof42 wrote: Sat Oct 03, 2020 10:43 pm How does one know or determine their bend points?

I’m leery about downloading a file off the net.
Search the forum for bend points.

It's not that hard to figure out when you read up on it a bit. You don't have to download stuff if you don't want to. But it's nice to get the income info off of the website.
I'm trying to think, but nothing happens
summerof42
Posts: 187
Joined: Wed Nov 12, 2014 12:33 am

Re: Social Security: Website Estimate vs Actual

Post by summerof42 »

spdoublebass wrote: Sat Oct 03, 2020 11:09 pm
summerof42 wrote: Sat Oct 03, 2020 10:43 pm How does one know or determine their bend points?

I’m leery about downloading a file off the net.
Search the forum for bend points.

It's not that hard to figure out when you read up on it a bit. You don't have to download stuff if you don't want to. But it's nice to get the income info off of the website.
@spdoublebass - I already established my SS account on line and have all my income, I’m referring to downloading the “detailed calculator” off the SS or Bogleheads site.
User avatar
spdoublebass
Posts: 755
Joined: Thu Apr 27, 2017 10:04 pm
Location: NY

Re: Social Security: Website Estimate vs Actual

Post by spdoublebass »

summerof42 wrote: Sat Oct 03, 2020 11:41 pm
spdoublebass wrote: Sat Oct 03, 2020 11:09 pm
summerof42 wrote: Sat Oct 03, 2020 10:43 pm How does one know or determine their bend points?

I’m leery about downloading a file off the net.
Search the forum for bend points.

It's not that hard to figure out when you read up on it a bit. You don't have to download stuff if you don't want to. But it's nice to get the income info off of the website.
@spdoublebass - I already established my SS account on line and have all my income, I’m referring to downloading the “detailed calculator” off the SS or Bogleheads site.
Oh I skipped that. Someone here published a nice spreadsheet. You can figure out the bend points from there.

I just wanted to see where the bend points fell. I’m still working and 37. So I was just curious how long it would take to hit them. I don’t think the second one will ever come into play for me. Ha!
I'm trying to think, but nothing happens
summerof42
Posts: 187
Joined: Wed Nov 12, 2014 12:33 am

Re: Social Security: Website Estimate vs Actual

Post by summerof42 »

Thanks spdoublebass. It’s the spreadsheet here I’m nervous about downloading on my computer. When I went thru the steps it indicated it’s a large file, so I stopped the process.

One has to be very careful what your downloading today!
User avatar
JoeRetire
Posts: 6646
Joined: Tue Jan 16, 2018 2:44 pm

Re: Social Security: Website Estimate vs Actual

Post by JoeRetire »

spdoublebass wrote: Sat Oct 03, 2020 9:53 pm
JoeRetire wrote: Sat Oct 03, 2020 1:13 pm
spdoublebass wrote: Sat Oct 03, 2020 12:25 am What about for people 20+ years out? Is it accurate that far out? I think it estimates certain things, but I guess it’s hard to predict the future that far out.
How good are any 20 year old estimates of anything? And why would you care?
I don't really. I created an account just to make sure my income is posted correctly. Creating an account also takes care of somebody else opening an account in your name (identity theft). When I created an account I noticed it gives me a projected amount for 62, 67, and 70.

I also want to know when I pass the first and second bend points.
Okay, you confused me when you didn't ask about the bend points, making sure your income is posted correctly, or protecting your account.

I assumed you cared about 20+ year accuracy, since that was what you asked.
It's the end of the world as we know it. | It's the end of the world as we know it. | It's the end of the world as we know it. | And I feel fine.
Post Reply