USAA Magazine Fall 2006

etirement coachQuestions loom as you near retirement, butScott Burns offers insight and advice that willhelp you plan for your futureRetirementon the horizonBY SCOTT BURNSScott BurnsPlease see importantlegal disclosures onpage 34.Taken from the ScottBurns column datedAug. 2, 2007, and Aug. 9,2007, by Scott Burns© 2007 Distributed byUNIVERSAL PRESS SYNDICATE.Reprinted with permission.All rights reserved.How to estimate your future SocialSecurity benefitI am 56. I retired after 30 years of teachingat the age of 52. I plan to take SocialSecurity at age 62. My understandingis that for the 10 years I will have been retiredand have not contributed to Social Security, thebenefit I will get will be decreased a small percenteach of those 10 years. A friend told me thatsomething has changed and that my amountwill be based on the average of my 30 years ofsalaries and not my last five highest years. Andthere will be no yearly decrease for each of those10 years I have not been working. Is this correct?— V.B., by e-mailYour Social Security benefit is basedon your earnings record, up to a maximumof 35 years. If you work morethan 35 years, the calculation is based on thehighest 35 years of earnings. If you work lessthan 35 years, the no-earnings years will countas zero and will lower your average and, hence,your benefit.If you visit the Social Security Web site, youwill find that it offers three calculators to helpyou figure out what your benefit is likely to be.The link you want to use is ssa.gov/planners/calculators.htm and the calculator you shoulduse is No. 2, the Online Calculator. It will ask youto select when you want to start benefits and toinput your earnings record. Then it will estimateyour future benefit. You’ll find your completeearnings history on the annual statement you receivein the mail each year from Social Security.Given the importance of Social Security forall but the wealthiest people, I think one of thebest “investments” you can make is to take thetime to become familiar with this very usefuland well-managed Web site, ssa.gov.PHOTOGRAPH BY GETTY IMAGES12USAA MAGAZINE WINTER 2007 USAA.COM