Social Security Analytics | Analytics | Benefit Start Analysis

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.

start your Social Security benefit start analysis

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 meeting the the benefit start analysis settings criteria. You should always double check the values you entered on the benefit start analysis settings page. We recommend leaving the settings at their default value for your initial analysis to establish a base analysis.

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 cash flow coverage percentage, the cash flow quality score, any ending savings amount, and any ending loan balance if borrowing occurred over the analysis period.

Cash Flow Coverage is the percentage of months in the analysis period where monthly cash inflows (Social Security benefits, retirement savings, work earnings, and any borrowing) meet or exceed monthly cash outflows (expenses including interest on any debt). A greater percentage indicates a greater chance of future cash inflows covering future cash outflows.
Cash Flow Quality Score is cash flow metric taking into account both cash flow coverage and cash flow magnitude (the amount of monthly net cash flow surpluses and deficits). Values range from 0 - 100 with greater values indicating greater quality and therefore a greater chance of future cash inflows covering future cash outflows.
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.

The Household Cash Flow section contains a chart showing household cash inflows and outflows (expenses) 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.

The Household Borrowing section contains a chart showing the end of year loan balance for each year in the analysis period. You can click on a year or bar on the chart to view additional details. Note this section will not appear unless you have set a Borrowing Credit Limit greater than $0 in the benefit start analysis settings.

Reviewing Benefit Start Strategy Value Sensitivity

Another important factor in chosing a benefit start strategy is how the strategy's value is effected by different model input values like life expectancy and future inflation. You can see the sensitivty of the strategy's value to changes in input values on the strategy sensitivty analysis page. You navigate to this page from the strategy detail page. Just click the "sensitivity analysis" button below the strategy detail section.

The strategy sensitivty analysis page contains the following charts :