Social Security: A Simple Way to Calculate Your Exact Benefits

Curious how your Social Security benefits are determined? Motley Fool contributor John Maxfield explains.

May 12, 2014 at 2:17PM


Wondering how much you'll collect in Social Security benefits? Regardless of how old you are, calculating your expected monthly payout is both easy and important.

Although the process seems shrouded in mystery and accessible only to someone with an advanced mathematics degree, the truth is that the Social Security Administration makes it relatively simple for prospective retirees to learn how much they'll receive each month in benefits.

The most direct way to determine this is to use the SSA's official Retirement Estimator. This references your actual earnings history and spits out three different estimates: one that applies at your full retirement age, a second that factors in your delayed retirement credit, and a third that assumes you apply for benefits at the earliest possible time.

This approach may be challenging if you're still young and expect your income to continue climbing. In this case, it's helpful to know roughly how your benefit is calculated. To discover where these figures come from, check out the video below, in which Motley Fool contributor John Maxfield explains the math behind your Social Security benefits.

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A Financial Plan on an Index Card

Keeping it simple.

Aug 7, 2015 at 11:26AM

Two years ago, University of Chicago professor Harold Pollack wrote his entire financial plan on an index card.

It blew up. People loved the idea. Financial advice is often intentionally complicated. Obscurity lets advisors charge higher fees. But the most important parts are painfully simple. Here's how Pollack put it:

The card came out of chat I had regarding what I view as the financial industry's basic dilemma: The best investment advice fits on an index card. A commenter asked for the actual index card. Although I was originally speaking in metaphor, I grabbed a pen and one of my daughter's note cards, scribbled this out in maybe three minutes, snapped a picture with my iPhone, and the rest was history.

More advisors and investors caught onto the idea and started writing their own financial plans on a single index card.

I love the exercise, because it makes you think about what's important and forces you to be succinct.

So, here's my index-card financial plan:


Everything else is details. 

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