Social Security Payment in 15 Years: Most retirees have Social Security benefits in mind for the future. If retirement is still a long way off, you might be curious about what an average Social Security benefit would be like when that time comes, say in 15 years, when you’re ready or almost ready to retire.
According to Martha Shedden, a CFP and president and co-founder of the National Association of Registered Social Security Analysts, figuring this out takes a little more than simple math.
Shedden claims that the average monthly Social Security income at this time is approximately $1,900. Nobody can accurately forecast the state of the economy or whether inflation will remain constant for 15 years, but they can make reasonable guesses with the aid of computer programs.
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According to Shedden, “the average benefit would be about $2,663 in 15 years if you assume an inflation rate of 2.25%.” “However, the average benefit amount in 15 years will be closer to $2,802 given the historical cost of living adjustments (COLAs) over the past 20 years of 2.6%.”
Shedden remarked that, in actuality, the recipient in fifteen years would still feel as though they were spending $1,907 on it now.
Social Security Payment in 15 Years: Don’t Underestimate Your Benefits
Although one may assume that people overestimate their benefits, Shedden stated that people typically underestimate the amount of Social Security they may be eligible to receive. When she and her spouse realized that they could receive about $90,000 annually collectively, they were taken aback.
According to Sheeden, “some high-earner couples who have earned the maximum amount every year have lifetime total cumulative amounts in the millions.”
The Point of Social Security
But according to Shedden, the purpose of Social Security isn’t to make millions of dollars. It was designed as a program to keep individuals out of destitution.
For those with lesser salaries, it frequently represents a larger portion of their overall retirement assets—between 50% and 90% of their projected retirement income, on occasion.
Lower-income people should be informed and aware of precisely how much that will be, according to Shedden. “Because that amount will increase for each month and each year that they can postpone collecting.”
For the remainder of their lives, the higher sum is subject to cost-of-living adjustments.
There is additional security income available to those who are below the poverty level (SSI).
Although Shedden acknowledged that it wasn’t particularly large, he claimed it was an important portion of many Americans’ retirement.
Get Ready for Social Security Benefit Cuts
But there is a lot of uncertainty over Social Security’s future. “If we consider the Social Security Administration’s predictions that benefits would need to be reduced by 23% around 2033 to maintain program stability without legislative intervention,” says Brian Kuhn, CFP and senior vice president at Wealth Enhancement Group, “the average benefit would decrease to about $2,182.”
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It’s critical to keep in mind that not everyone receives the same benefits and that these are merely averages. Additionally, it’s critical to take all reasonable steps to avoid relying solely on Social Security during your retirement.
Start Retirement Planning Early
“It’s never too early to begin retirement planning,” Shedden stated. “The importance of forming a savings habit early on and watching it grow cannot be emphasized.”
It’s best to give oneself as many possibilities as possible
“Social Security is only one piece of retirement income and was never meant to replace 100% of pre-retirement earnings,” as Shedden pointed out.
Pay Yourself First
Save as much as you can by “paying yourself first” if you’re thinking of retiring in your 40s or younger, Shedden advised. “Assign a specific portion of every paycheck to a savings or investment account.”
Get That Free Money
Shedden advised making the most of workplace-based retirement plans at all times to benefit from the “free” employer match and the longer years of compounding on these assets.
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For Later Planners
Shedden advised those who were hoping to retire in their 50s and beyond to continue saving, increase their nest fund, and begin thorough financial planning. Be sure to consider what other stable, guaranteed sources of income you will have in addition to Social Security to support the lifestyle you have in mind.
You may retire comfortably with these solutions in place, regardless of what you anticipate receiving from Social Security in 15 years or more.
