Social Security and Other Federal Retirement Benefit Payments for 2023:
The 2023 Cost of Living Adjustment (COLA) of 8.7% for Social Security (and the Federal CSRS annuity) is the second year in a row that these Federal benefits has large increases (the COLA for 2022 was 5.9%). The Federal FERS annuity will increase by 7.7% next year.
We will adjust our tax projections as well as cash flow modeling for our clients in early 2023. When we have our spring financial planning meetings, we’ll show you the impact of these large increases in your retirement cash flow projections.
Social Security Benefit Modeling in 2023
If you have wondered what your future Social Security benefits might look like, you can obtain a rough projection directly from the Social Security Administration’s website. You’ll need to set up an account at SSA.gov and then request the benefit statement.
Because there are many factors that go into determining your future Social Security benefits, we prefer to enter your data into our software and then tailor the calculations based on your actual planned future earnings amounts, when you plan to stop working entirely as well as when you might phase into retirement. Your claiming date and strategy based on spousal benefits matters, too.
If you send us the XML file that is downloadable from SSA.gov, we’ll run these numbers through our software and discuss with you at your next meeting what you anticipate your future earnings will be over your lifetime. This will give you a much more accurate idea of what to expect from Social Security when you decide to claim.
We’ll use this information for tax planning and cash flow projection modeling. And we’ll help you decide what the best claiming strategy is for you based on your own thoughts and feelings about a variety of factors.
Check out this list of things to consider with your Social Security Retirement Benefits.