Social Security Benefit Start Analysis Help
What is Social Security Benefit Start Analysis?
Social Security Benefit Start Analysis is the process of finding the Social Security benefit start strategy (start month) that maximizes the value of your household retirement income subject to retirement expenses.
Our Social Security Benefit Start Analysis tool helps with your analysis by finding and analyzing all possible benefit start months based on the analysis information you enter.
The tool uses the information you enter for work earnings history, current age, life expectancy, expected stop work month, current retirement savings and expected retirement expenses to calculate future household income and expenses for all possible Social Security benefit start months (benefit start strategies.) If you have a spouse, the tool looks at all combinations of benefit start months and Social Security benefit types (retirement and spouse benefits) for you and your spouse.
The tool examines all possible benefit start strategies including those where :
- Both you and your spouse opt to receive Social Security retirement benefits.
- One spouse receives Social Security retirement benefits and the other Social Security spouse benefits.
- A spouse switches to Social Security survivor benefits after the death of his or her spouse.
- You and or your spouse work while receiving Social Security benefits.
What are the steps in the analysis?
The following outlines the analysis process:
- Enter information about you and your spouse, household retirement savings, and retirement expenses.
- Run the analysis.
- Review the analysis results.
- Select a benefit start strategy.
How do I choose a benefit start strategy?
Selecting a Benefit Start Strategy by Strategy Value
Once you've run the analysis, you'll see a table containing a list of the "highest value" benefit start strategies. In the analysis, each benefit start strategy leads to a specific stream of income over the analysis period from Social Security benefits, work earnings, and income from retirement savings. The strategy value incorporates both the amount of retirement income and it's timing, with a dollar of retirement income received today worth more than a dollar of income received in the future. By choosing the benefit start strategy with the highest value, you are maximizing the amount of retirement income you receive over the course of your retirement in today's dollars subject to you retirement expenses. The benefit start strategy having the highest value is, therefore, a good place to start your analysis.
Important : If the benefit start strategy list is empty, it indicates no benefit start strategies could be found given the information you have entered. You should always double check the data values you entered. If you have madechanges to the benefit start analysis settings, we recommend leaving the settings at their default value for your initial analysis to establish a base analysis.
In addition to a strategy's value, you should also look at a strategy's deficit. A strategy deficit greater than $0 indicates one or more months during the analysis period (retirement) where expenses exceed income. A deficit means you will have to either reduce future expenses or increase future income.
Finally, you will also want to look at the benefit start strategy's ending savings. Ending savings is the amount remaining in your retirement savings accounts at the end of the analysis period. An ending savings balance greater than $0 indicates a reserve in your savings that can be used for unexpected expenses and possibly a bequeath to others.
Reviewing Benefit Start Strategy Details
Once you've selected a benefit start strategy from the list, you'll want to review the strategy's details. To navigate to a strategy's detail from the benefit start strategy list, click table row containing your chosen strategy to display the benefit start strategy's detail page. The benefit start strategy detail page contains several sections.
The Strategy Summary section contains the benefit start month/benefit type information for the household, the strategy value, the cumulative deficit over the analysis period, any ending savings amount, and any ending loan balance if borrowing occurred over the analysis period.
The Household Income, Expenses, and Borrowing section contains a chart showing household income, expenses, and borrowing for each year in the analysis period. You can click on a year or bar on the chart to view additional details.
The Household Savings section contains a chart showing the end of year balance of all household retirement savings accounts over the analysis period. You can click on a year or bar on the chart to view additional details.