Why do my Social Security benefits decline at age 74?

I claim-and-suspend. Mine are calculated as $40,638 for ages 71 through 73, then decline to $40,303 for the remainder of retirement. My wife's benefits similarly decline at the same age. What would cause that?

Thanks.

Comments

dan royer's picture

Do you have a change in benefit set in the Assumptions screen under Benefits? Is there some earnings reduction perhaps for those years?

All post-retirement, so no earnings to reduce. Assumptions are defaults, so no assumed benefit changes. I assume an increase in taxable benefits would show up under taxes and not under non-asset income?

Thanks for responding.

dan royer's picture

I could take a look if you upload the database to a support ticket. I meant that there is a setting in the Assumptions area of the program where you can change future SS benefits. Perhaps that setting got changed.

I understood and checked that -- no changes. I'll upload a database. Thanks.

Database is attached. I'm referring to the Social Security benefits of the Cotton2 Profile. Thanks for the help.

FYI - your database is visible to everyone when you post it on the forum.

You should take it down and repost in a support ticket so only the ESPlanner team can see it, along with yourself.

Best,
Brian

dan royer's picture

I got the database and removed it. I'll take a look.

dan royer's picture

You have inflation set to change in the year 2024, and that's the year you see the SS benefit change. I'm not sure that I can explain the math behind the SS benefit going down when the inflation rate is assumed to go up.

A few years ago I saw an issue where SS benefits changed slightly from one year to another. If I remember correctly, Dick Munroe said it had something to do with synchronizing inflation and SS COLAs. This happened on rare occasions.

Of course, your situation may be different.

Best,
Brian

dan royer's picture

Mike is investigating this issue further. He thinks it might be a bug, but he's investigating. I'll report back.

Thanks, that fixed it. No idea how that inflation change box got checked or why that would affect benefits, but hope you find the cause. Thanks for taking down my data, but it was actually fabricated to explore upside investing, so no harm.

Thanks again for great support.

dan royer's picture

Yes, I'm not smart enough to understand all the math or what "should be reported," but Kotlikoff says that's not supposed to do that so they put this on the fix list. Yes, for now, just leave the future inflation rate unchanged I guess.

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