Question

1. Assume Karen was born January 1 in the year in which the youngest baby boomers were born. Her earnings are $98,000 this year.
   1. How much will her social security retirement benefits be if she retires in 2029? ________________
   2. How much is this amount worth today if adjusted for inflation, per the Social Security Administration website? _________

Answer 1

You can get Social Security retirement benefits as early as age 62. However, we'll reduce your benefit if you retire before your full retirement age. For example, if you turn age 62 in 2020, your benefit would be about 28.3 percent lower than it would be at your full retirement age of 66 and 8 months.

N0w the earning = $ 98,000

at 2029 her age will be 65 so she will get a retirement benefit upto 86%

Therfore her retirement benefit at 2029 = $ 98000* 86% = $ 84,280

SSA inflation rate = 1.6%

Therfore,amount worth today if adjusted for inflation, per the Social Security Administration website will be

$ 98,000 * ((1+(1.6/100))^9) = 98,000 * 1.1535 = $ 99,568