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Old 07-04-2018, 04:45 AM
 
3,932 posts, read 2,277,743 times
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I have a military retirement. I reviewed my SS.gov account and it seems over time I am not getting as much as was promised years ago. Maybe they recalulate newer incomes.
Regardless, I am going to take it as soon as I can. I would rather have an additional 15 to 20K a year coming in than waiting five years, as I may not be here then.
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Old 07-04-2018, 06:58 AM
 
Location: Boston
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SS is play money for us. Wife took it at 62, we travel with it. Don't really need it, but hey, I'll take anything we can get.
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Old 07-05-2018, 09:19 PM
 
Location: Ohio
17,998 posts, read 13,233,625 times
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Quote:
Originally Posted by Steve40th View Post
I have a military retirement. I reviewed my SS.gov account and it seems over time I am not getting as much as was promised years ago. Maybe they recalulate newer incomes.
Regardless, I am going to take it as soon as I can. I would rather have an additional 15 to 20K a year coming in than waiting five years, as I may not be here then.
Your income is calculated using the highest 35 years of income. Military retirement benefits are not counted as income.

Your income is also indexed to reflect changes in Inflation and Standard of Living.

Generally, the wage index increases, but there are occasions when it decreases. People who retired in 2011 got less benefits than their peers who retired before or after them, because wages decreased in 2009 (and wages are indexed to the 2nd year before you file for benefits for several reasons, namely it takes about year to determine the average wage for the previous year).

Suppose you earned $10,400 in 1980, which you would have earned if your wages were $5/hour, a typical wage in 1980.

The wage index for 1980 is $12,513.46 and for 2016 it's $48,642.15. If we divide the latter by the former, then we get 3.887 and we multiply your 1980 wage of $10,400 by that figure to get $40,424.80 and that is the wage used to calculate your benefit, not the $10,400 you earned in 1980.

If you spent 23 years in the military and retired, and looked at your Social Security benefits in your 23rd year, the program is designed to assume that you will continue working for the next 12 years and that your annual income will increase by a percentage each year as determined by actuaries in their forecasts.

You can index your own wages on a spread-sheet and use these numbers:

https://www.ssa.gov/oact/cola/AWI.html#Series

After you index the years you worked -- military retirement benefits don't count -- add them together and divide by 420.

That's your average monthly income.

Multiply the first $895 by 90%. If your monthly average is less than $895, you're done, and that's your monthly Social Security benefit.

If you're monthly average is greater than $895 and less than $5,400, then multiply that by 32% and it to the previous percentage of monthly income and you're done, and that's your monthly Social Security benefit.

For any amount over $5,400 multiply that by 15% and add it together with the other two figures, and that's your monthly benefit.

If you do that, you should use W-2 Forms, because only the amount in Box #3 is used to calculate your Social Security benefits, and not the amount in Box #1, because not all of your pay is necessarily taxable for Social Security purposes. If you're using an LES, then look at Box #40 only.
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Old 07-06-2018, 03:14 AM
 
3,932 posts, read 2,277,743 times
Reputation: 1781
Quote:
Originally Posted by Mircea View Post
Your income is calculated using the highest 35 years of income. Military retirement benefits are not counted as income.

Your income is also indexed to reflect changes in Inflation and Standard of Living.

Generally, the wage index increases, but there are occasions when it decreases. People who retired in 2011 got less benefits than their peers who retired before or after them, because wages decreased in 2009 (and wages are indexed to the 2nd year before you file for benefits for several reasons, namely it takes about year to determine the average wage for the previous year).

Suppose you earned $10,400 in 1980, which you would have earned if your wages were $5/hour, a typical wage in 1980.

The wage index for 1980 is $12,513.46 and for 2016 it's $48,642.15. If we divide the latter by the former, then we get 3.887 and we multiply your 1980 wage of $10,400 by that figure to get $40,424.80 and that is the wage used to calculate your benefit, not the $10,400 you earned in 1980.

If you spent 23 years in the military and retired, and looked at your Social Security benefits in your 23rd year, the program is designed to assume that you will continue working for the next 12 years and that your annual income will increase by a percentage each year as determined by actuaries in their forecasts.

You can index your own wages on a spread-sheet and use these numbers:

https://www.ssa.gov/oact/cola/AWI.html#Series

After you index the years you worked -- military retirement benefits don't count -- add them together and divide by 420.

That's your average monthly income.

Multiply the first $895 by 90%. If your monthly average is less than $895, you're done, and that's your monthly Social Security benefit.

If you're monthly average is greater than $895 and less than $5,400, then multiply that by 32% and it to the previous percentage of monthly income and you're done, and that's your monthly Social Security benefit.

For any amount over $5,400 multiply that by 15% and add it together with the other two figures, and that's your monthly benefit.

If you do that, you should use W-2 Forms, because only the amount in Box #3 is used to calculate your Social Security benefits, and not the amount in Box #1, because not all of your pay is necessarily taxable for Social Security purposes. If you're using an LES, then look at Box #40 only.
Nice write up. Thanks.
I would rather not pay into SS as others benefit from it, when it should be just me. And, I could have invested that myself for a better return.
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