There’s a Really Easy Way to Estimate Your Future Social Security Benefit. Here’s How.

If you’re fairly young and decades away from being able to claim Social Security, then the program might be a big mystery to you. You may be aware that in the future, you’ll be eligible for some sort of monthly benefit. But you may not have a clue as to what that benefit looks like.

The good news, though, is that the Social Security Administration (SSA) doesn’t want to keep that information a secret. Quite the contrary — there’s an easy step you can take to figure out what monthly benefit you might be in line for once your career comes to an end.

A small amount of legwork is all it takes

Each year, the SSA issues workers an earnings statement that summarizes their wages for the year. You can access yours by creating an account on the SSA’s website, since these statements don’t automatically get sent out by mail until you turn 60.

Your earnings statement, in addition to a wage summary, will also include an estimate of your future monthly Social Security benefit. So rather than completely guess at that number, you’ll at least have a starting point.

Of course, the younger you are, the more likely your estimate is to change over time. The monthly Social Security benefit you’ll be eligible for in retirement will hinge on your wages earned during your 35 most profitable years in the labor force. If you’re only in your 30s, for example, it may be that your earnings haven’t yet peaked, so your estimate may not be the most spot-on.

But again, it’s good to use that estimate as a starting point. That way, you can start to do some thorough retirement planning.

Use that information to your advantage

The upside of getting an estimate of your monthly Social Security benefit well ahead of retirement is that it might inspire you to work harder at building savings.

Let’s say you were expecting to get $4,000 a month out of Social Security, only to look at your earnings statement at age 45 and see an estimate of $2,000 instead. Clearly, that’s a much smaller sum. But seeing that number on screen might motivate you to start boosting your IRA or 401(k) plan contributions while you still have another 20 years in the workforce or more.

You should also know that if you’re not so thrilled with the estimate you get, you can always take steps to set yourself up for a higher monthly benefit. Those could include boosting your income with wages from a second job and, later on, delaying your Social Security claim beyond full retirement age. For each year you hold off past that point up until age 70, your Social Security benefit gets to grow 8%.

When it comes to financial matters, it’s always a good thing to be in the know. It pays to get an estimate of your future monthly Social Security benefit, whether you’re 25 or 65. Having that information could influence your approach to retirement savings and help you arrive at a place where you don’t have to worry about money so much once your career has concluded.