[Jason]

When people refer to the their FI number our their Social Security benefits usually calculated in or left out?

And for FIRE does it factor in social security benefits?

Why or why not? I’d love to hear different perspectives on whether Social Security should be factored into FI planning and how people approach it.

[Dillon]

Personally, I do not take social security into account.

I believe it will be there although possibly reduced but I see it as more a supplement to rising healthcare costs in the future as I reach that age and beyond.

[Jeff]

Think of someone that wants $80,000 in retirement and can generate $44,000 with their assets and were entitled to $3000 per month with social security.

If they ignored the social security, they would need to save an additional $900,000 in order to generate that $3000 per month.

I am not telling anyone what to do, but it is absolutely a risk to ignore social security and force yourself to work many years more than necessary to retire.

I think the majority of this group only considers the idea of “risk” as either losing money or running out of money.

For many peopl , the real risk is unnecessarily working far longer than needed to achieve their goals.

[Jeremy]

If SS ceased to exist, it probably means that the world as we know it has already ended, and we’re scavenging the wasteland for gasoline while avoiding mutant cannibals.

[Jeff]

I think many people who don’t factor in social security at all don’t realize they may be forcing themselves to work many years longer than necessary to achieve their goals.

I personally assume social security will be there in a somewhat similar form to what it is now.

There are so many ways they can fix it if needed. No politicians want to be the ones to end it as it is massively popular and getting rid of it is almost a guarantee of them losing their voters.

I think some view it as being more “conservative” with their numbers by not including it but they may work 5-10 years longer than needed by doing so.

[Ron]

I’m retired. Because my Social Security covers all my expenses, it’s certainly relevant to FI.

I’d say if you are 5 years out from being able to collect SS, start incorporating it.

Before then, no, because of the uncertainty.

[Amanda]

I do include it, and I hope none of you who don’t will take its destruction lying down.

What’s happening right now is pillaging to the extreme and my parents, aunts, uncles and others are at risk, and I will fight for them.

[Stan]

Nope, don’t include it. Too many variables not in your control. All it takes is the “stroke of a pen” and some federal votes to abolish it, change the rules, modify it or anything else and if your plan includes it then your plan is no longer valid.

Consider it “couch cushion” money if it is still there meaning that if you have it it is like money you didn’t expect.

[Frank]

It depends how old you are and when you are planning on taking it. If you are 50 or older, when retiring, I would.

[Dan]

I would definitely include social security in your FI number, at least at an 85% level, or you’ll end up working far longer than needed.

Social security is likely one of your largest, if not your largest, retirement assets!!

Don’t ignore it!

[Eva]

If you want to include it use Boldin.
I personally do not include in my analysis because I’m in my 30s far away from it and it might look different by then.

The meaningful fi calculator is what I used earlier on in our journey:

[Ron]

It is helpful to look at it both ways: with and without. That said, the conservative side of me, forced me to wait until I hit my FIRE number even if I left out SS.

[Ed]

If you’re 20 years or more from collecting, I certainly wouldn’t include it.

Getting within 10 years or less, you have a clearer picture of if you’re going to retire early, if you may need a higher withdrawal rate for several years, or working to FRA.

Every situation is different, but the closer you get, the more detailed your plan can be that may include fixed income streams like SS, pensions annuities or inheritance.

[Linda]

I am 61 and retired. My husband is still working. We calculated our numbers 3 ways-with no Social Security, with full Social Security and with 70% of the Social Security benefits, promised.

That way we could get a good visual on potential outcomes.

I am confident Social Security is not going away (it may be reduced) for those of us on this end of the age scale.

If I were younger, I would not include it.

[Matt]

Personally, I did not take SS into account for determining “FI number”, as one padding of reserve (knowing it WILL be impacted in some way), and 4%ish for directional accuracy, only.

I highly recommend, before you pull the trigger (ideally 7 years prior) on Early Retirement, you engage with a fiduciary, advice-only CFP to hash out a much more actionable plan.

I retain our CFP to help monitor our blind spots and rejigger the plan as our perspectives on the next phases change and another phase is underway.

FI/FIREd with 2 pre-college teens, for reference.

[Trevis]

I don’t include it. In my mind it’s longevity insurance in case one or both of us lives a long time.

[Bill]

Kinda depends on your age. It’s almost certainly going to be there, but if you can’t claim it for 20 years, it doesn’t really impact your FI number.

All the sequence of return risk for the 4% rule is those early years.

[Rick]

Absolutely count it but for me I chose to count it as gravy money. Meaning I did not run simulations where I spent much more for many years aiming to reduce my net worth to then have SS provide it’s expected backstop in the future.

It is “insurance” against many years of crazy high inflation. It is money to take my adult kids on trips together.

So maybe using FIRE terms, I count SS as insurance against lean fire or as fat fire money.

Somewhere in that huge range of possible uses.

[Paul]

I use two calculations – one with, one without. There will be some SS for us but we won’t claim until a decade or more into retirement.

[Jasmine]

I FIRE-ed in my mid-40s and didn’t factor SS into anything given I was decades out from SS Full Retirement Age.

I’ll probably factor it into my thinking when I’m much closer, perhaps 5-10 years from FRA.

[Sarah]

I think it depends how old you are. I do not include it in mine because I believe any changes will affect my age group.

My husband is older than me.

I’m banking on him being close enough to retirement age that his benefits would not change. So, we include his in our calculations.

[Author]

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