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Old 12-10-2016, 07:06 AM
 
Location: RVA
2,172 posts, read 1,272,094 times
Reputation: 4492

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This was mentioned in another, now closed thread. For 2015, assuming you had a FICA taxable income at or over the SSA limit every year from 1980 through 2015, according to

Social Security: Here's the Maximum Benefit You Can Get

Your maximum benefit at FRA of 66 is about $32,000/yr. If you were 70, but had the same last 35 years income, it would be about $42,000 a year.

As the upper limit of FICA taxable income increases, which raises your individual AIME (inflation adjusted average monthly income), then the top benefit rises, though rather slowly. COLA increases CAN have a much larger influence, since as a direct overall multiplier, the compunding effect is immediate. It is why, when using those SSA calculators that predict ones future benefits, one must be very careful a out the COLA built in, many use the last 20 year average of 2.39%, which we haven't seen in many years. Just reducing the average COLA to 1.5% will reduce the estimated benefit 10 years away many thousands of dollars. Sequence of earnings (same as COLA), shows that actual increases (or earnings) can vary immensely from the "average" taken every year vs the actual percentages per year, depending on the extremes. The max SS benefit for a 59 year old collecting at FRA varies over $2k depnding on the numbers used, and at 70, over $6k, from $47k, to over $53k. Pretty big variances, with a lot of assumptions, especially on future upper limits.

High yearly AIMEs from the '80s are about $105k, thanks to the fast percentage rise of increased limits and following high inflation years, so next years $127k would replace a $105k. An increase of $22k to ones 35 year max, which alone can increase the FRA monthly by about $30. So it is not inconceivable at all, if the wage caps used for SS increase every year like this year (from $118,500 to $127,000), AND one keeps earning a salary above that limit, that with any moderate COLAs, based on the current formula, $4167/mo ( $50k/yr) SS checks will be easily possible.
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Old 12-10-2016, 08:25 AM
 
29,819 posts, read 34,912,438 times
Reputation: 11735
Quote:
Originally Posted by Perryinva View Post
This was mentioned in another, now closed thread. For 2015, assuming you had a FICA taxable income at or over the SSA limit every year from 1980 through 2015, according to

Social Security: Here's the Maximum Benefit You Can Get

Your maximum benefit at FRA of 66 is about $32,000/yr. If you were 70, but had the same last 35 years income, it would be about $42,000 a year.

As the upper limit of FICA taxable income increases, which raises your individual AIME (inflation adjusted average monthly income), then the top benefit rises, though rather slowly. COLA increases CAN have a much larger influence, since as a direct overall multiplier, the compunding effect is immediate. It is why, when using those SSA calculators that predict ones future benefits, one must be very careful a out the COLA built in, many use the last 20 year average of 2.39%, which we haven't seen in many years. Just reducing the average COLA to 1.5% will reduce the estimated benefit 10 years away many thousands of dollars. Sequence of earnings (same as COLA), shows that actual increases (or earnings) can vary immensely from the "average" taken every year vs the actual percentages per year, depending on the extremes. The max SS benefit for a 59 year old collecting at FRA varies over $2k depnding on the numbers used, and at 70, over $6k, from $47k, to over $53k. Pretty big variances, with a lot of assumptions, especially on future upper limits.

High yearly AIMEs from the '80s are about $105k, thanks to the fast percentage rise of increased limits and following high inflation years, so next years $127k would replace a $105k. An increase of $22k to ones 35 year max, which alone can increase the FRA monthly by about $30. So it is not inconceivable at all, if the wage caps used for SS increase every year like this year (from $118,500 to $127,000), AND one keeps earning a salary above that limit, that with any moderate COLAs, based on the current formula, $4167/mo ( $50k/yr) SS checks will be easily possible.
Sure, I am a few hundred annually short of the Max when I claim at 70. I have seen the max grow since I retired and with compounding 50k is not that far away as you note
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Old 12-10-2016, 09:06 AM
 
71,867 posts, read 71,942,576 times
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at 70 a couple can see quite a ss payment today if they have decent earning history's . we will see about 55k and my wife's earning record sucks . that will be increased with inflation too .
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Old 12-10-2016, 05:42 PM
 
Location: RVA
2,172 posts, read 1,272,094 times
Reputation: 4492
My wife was a teacher in states that paid in to SS but filed at 62 and at 64 gets about $1200/mo now. Hers plus mine in 11 years when I am 70 should be north of $67k, which will be a bit more than our combined pensions.
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