As part of the estate planning process, we frequently need to analyze how much a person is likely to have upon death. As part of an overall wealth analysis, this invariably leads to questions such as:
- How much are you earning now?
- When are you expecting to retire?
- How much should you gift to your children to minimize taxes while still having enough to live on?
- What do you expect to earn/spend in retirement?
- How much are you likely to receive from Social Security?
Many clients are concerned with running out of money and have a lot of difficulty calculating the best strategies for how and when to start claiming their Social Security. After all, the strategy of wait until as late as possible simply doesn’t work for everyone. From a pure return on investment strategy, it might be worthwhile for a low income earner in a marriage to take the benefits early. This is particularly true when there is a big age disparity between spouses.
In looking around online, I found a wonderful website to help you analyze the best strategies. The site Open Social Security has a great calculator for spouses that let’s you know, based upon your ages and the amount Social Security expects you to receive at full retirement, when is the best time for each of you claim your social security.
We still recommend speaking with your attorney and other advisors to fully flush out all the issues, such as factoring in the health of your and your spouse, discussing when other income should come in, and what type of guaranteed money is otherwise likely to be available. Nevertheless, this is definitely one of the better calculators I’ve seen.