Social Security will give me the following amounts per year, depending on when I retire: Age 62
Question:
Social Security will give me the following amounts per year, depending on when I retire:
Age 62 $28,680/yr till death
Age 65 $35,304/yr till death, and no Social Security benefit before then.
Age 67 $40,740/yr till death, and no Social Security benefit before then.
Assume a conservative discount factor of 5%.
I expect to live to age 80.
I'm currently 60.
I make $75k a year and will continue to work until I begin to claim my social security benefit, at which point I will resign from MSU.
BTW - Social Security will allow me to earn $20k a year in employment income without penalizing my retirement benefit. This will be done by the beginning of the year I start social security and continue to do so until age 70.
Calculate the NPV for each of the three scenarios using an Excel worksheet. Pleaseprovide me with the formulas used at every step. When should I retire?
Also - what's the total amount I'd receive for each scenario without discounting? What lesson have you learned?
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill