Research & Analysis by Brian J. Alleva
The rules for claiming Social Security retired-worker benefits are complex in large part because they offer a potential claimant flexibility in choosing a claiming age most to his or her advantage. The complexity of those rules is multiplied for a married couple, as the potential eligibility for spousal benefits, the couple's age difference, and other factors must also be considered. The number of claiming-age combinations available to a married couple varies widely for couples with different circumstances. This note explores the claiming rules, contingent situations, claiming-age combinations, and benefit amounts available to married couples across a range of respective birth years and benefit levels based on respective earnings histories.
Choosing the claiming age that maximizes the expected present value of lifetime Social Security retirement benefits requires a survival function to account for an individual's prospective longevity along with the specification of a rate by which to discount the future benefit payments for each claiming age. This article evaluates optimal claiming ages for prospective beneficiaries across a range of 81 real discount rate options (specified in increments of one-tenth of 1 percent) from 0 percent to 8 percent, considering the survival functions for men and women born in 1952. It examines the implications of choosing a given rate as well as the sensitivity of the optimal claiming age to a specific rate choice.
The Longevity Visualizer: An Analytic Tool for Exploring the Cohort Mortality Data Produced by the Office of the Chief Actuary
This note introduces the Longevity Visualizer (LV), a visual-analysis tool that enables users to explore various applications of cohort life-table data compiled and calculated by the Social Security Administration's Office of the Chief Actuary. The LV presents the life-table data in two series—survival functions and age-at-death probability distributions—each of which is generated for each potential age and each sex across a long range of historical and projected birth cohorts. The LV is designed to make complex longevity projections accessible to analysts and researchers, as well as to individuals making financial and retirement plans.