This page is intended to show examples of a few different aspects on using AI.

• Core subject: Discussion on when could be appropriate to start withdrawing social security, “SS” (US federal pension).
  • With 3 scenarios – 62 yrs old (earliest possible), 67 yrs (“Full Retirement Age”, “FRA”), 70 yrs (lastest when must start take SS)
• The importance on questioning results, to highlight that answers by AI tools (e.g., in this ChatGTP) actually quite rarely are complete and  follow up questions are essential.
  • Like what happens if SS ‘runs out of money’? (Which unfortunately looks rather likely – considering the US government’s problems coming to any agreements around anything, and this (SS) been a long-coming and known problem without yet any resolve. Increasing budget deficits and no signs of dealing with U.S. national debt including the big demographics problem makes finding solutions more difficult by the day.
• Also to show on the power of using AI tools to sort out may the most complex problems with easily helping sorting lots of details. Like getting data into columns, by month, with different aspects like cash payments, with or without COLA, add taking inflation into consideration thus indication actual future purchasing power.

 

Me: Male, Born May 1964, Average health, … Strategy?

“If I am a male born in may 1964, average health, w expected SS around $2200 per month at 62 years old, what is a good strategy for starting taking SS?”

ChatGPT: Interesting “transition” birth year …

You’re in an interesting “transition” birth year—born May 1964—so your full retirement age (FRA) under Social Security rules is 67. Here’s a breakdown tailored to your case:

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Key facts for you:

• Birth year: 1964 → FRA = 67.
• Eligibility age: 62 (2026).
• Estimate at 62: $2,200/month.
• Average health, male: Life expectancy ~82–85 years (but personal/family history matters a lot).
• Claiming window: Anytime between 62 and 70.

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How benefits change if you wait:

Social Security applies two main adjustments:

1. Early Claiming Penalty:
   • At 62: about 30% less than your FRA benefit.
   • At 67: 100% of your FRA benefit.
   • At 70: about 124% of FRA benefit (8%/yr delayed retirement credits from 67–70).
2. So if $2,200 is your age-62 estimate, then roughly:
   • At FRA (67): about $3,142/month.
   • At 70: about $3,898/month.

(These are approximations; the SSA statement gives precise numbers.)

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Strategy considerations

1. Health & longevity
   • If you expect shorter life span (major health issues, family history of early mortality), starting at 62–64 can make sense.
   • If you expect longer life span (average or above health, parents lived into 80s/90s), waiting until at least FRA or 70 maximizes lifetime benefits.
2. Income needs
   • If you need the cash flow at 62 to cover living expenses (and want to avoid debt), claiming early can be practical.
   • If you can cover expenses with work, savings, or other pensions, delaying grows your guaranteed income.
3. Break-even math
   • The “breakeven” age (where waiting pays off) is usually around age 78–80.
   • Live past that, and delaying wins. Die earlier, and claiming early wins.
4. Spousal/family benefits
   • If married, your claiming age affects survivor benefits. Waiting can lock in a higher survivor benefit for a spouse.
5. Working before FRA
   • If you claim before 67 and keep working, your benefits are temporarily reduced if earnings exceed ~$22K/year (2025 numbers; changes yearly).

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Practical rules of thumb

• If you’re in average health, not desperate for income, and have other assets → strongly consider waiting until FRA (67).
• If you want to maximize guaranteed monthly income, especially for survivor protection → wait until 70.
• If you need the money or expect below-average longevity → claiming at 62 is reasonable.

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✅ Simplified suggestion for you:
Since you said “average health”, a balanced approach is:

• Don’t claim at 62 unless you really need the money.
• Target 67 (FRA) if you want a good middle ground.
• If you can comfortably cover expenses until 70, that’s the best way to maximize income and longevity protection.

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Do you want me to run a custom breakeven analysis for you—showing how much lifetime benefit you’d get at 62 vs 67 vs 70 depending on how long you live?

 

Me: so, basically conventional wisdom, what about SS running out of money?

“Ok, so what you say so far is basically the conventional wisdom. But, what about impacts of SS running out of money, and politicians so far not showing any signs of being able to fix things, including neither current president. Wouldn’t it be smart to start at 62, and then at least getting 100% of that levels amount, and then when SS runs out of money, and expected payments maybe will be only let’s say 70%?”

ChatGPT: That’s a really good point …

That’s a really good point — and it’s where the “conventional wisdom” often stops short. Let’s unpack the Social Security trust fund problem and how it might affect your decision:

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The Funding Issue

• The trust fund is projected to be depleted around 2033–2034 (you’ll be about 69–70).
• After that, payroll taxes alone are expected to cover about 75–80% of scheduled benefits (depending on which report you read).
• That doesn’t mean Social Security “goes away” — it just means, under current law, everyone would take a cut unless Congress acts.

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Political Reality

• Historically, Congress has always stepped in before drastic cuts.
• Potential fixes include: raising the retirement age, lifting the payroll tax cap, adjusting COLAs, or some mix.
• But yes — so far, neither major party has taken leadership to enact reforms, and delay makes the eventual fix harder.

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What that means for you

If you file at 62 in 2026:

• You’d lock in about $2,200/month.
• If a 25% cut hit in 2034, that would fall to about $1,650/month.

If you waited until 67 in 2031:

• You’d start at about $3,142/month.
• If a cut hit in 2034, that would fall to about $2,356/month — still a lot higher than the reduced-then-cut 62 claim.

If you waited until 70 in 2034 (just as the trust fund runs dry):

• You’d start at about $3,898/month.
• After a 25% cut → about $2,924/month.

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The Irony

Starting at 62 does not really protect you against cuts — because:

1. Cuts would apply to everyone, regardless of when they claimed.
2. By starting early, you’ve already taken the ~30% permanent reduction for life.
3. After a cut, your reduced benefit is cut further.

So, in the “70% benefits” scenario, early claiming actually leaves you worse off.

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What to do about the uncertainty

Some strategies people consider:

• Hybrid approach: Don’t assume worst-case. Maybe plan finances as if you’ll get 75–80% of projected benefits, and then any fix or full payment is “upside.”
• Diversify income sources: Build IRA/401(k)/HSA balances so you aren’t dependent only on SS.
• Hedge with claiming age: If your biggest fear is cuts, maybe don’t delay all the way to 70 — but aiming for FRA (67) still balances the risk of cuts with higher locked-in benefits.

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✅ Bottom line for your situation:
Starting at 62 won’t shield you from future cuts. If cuts happen, everyone is affected, and early claimers are hit hardest because their base benefit is already smaller. If you’re worried about solvency, a “middle-ground” like claiming at 67 may actually be the smartest hedge — you’ve locked in a much higher benefit, and if there’s a haircut, it’s taken off a bigger number.

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Do you want me to run a side-by-side table showing lifetime payouts under three scenarios:

1. No cuts
2. 25% cut starting 2034
3. Some kind of phased political fix

That way you can see how claiming at 62, 67, or 70 plays out depending on what happens?

 

Me: Yes, to see claiming at 62, 67, 70 sounds good.

“Yes, side-by-side sounds good. And including cumulated payments from when each scenario starts.”

ChatGPT: I ran the numbers… 62, 67 (FRA), and 70 side-by-side, under 3 policy scenarious

Good — I ran the numbers and put three claiming ages (start at 62, 67 (FRA), and 70) side-by-side under three policy scenarios, then showed cumulative (nominal) payments received by several later ages. I also list the assumptions used and a short interpretation of what the numbers mean for your decision.

Sources (key facts I used)

• Full retirement age = 67 for people born 1960 or later. (Social Security)
• Delayed retirement credits = +8% per year for births in 1943+ (so 124% of FRA at age 70). (Social Security)
• Trustees’ report: combined OASDI reserves projected to be depleted in 2034, and continuing income would pay about 81% of scheduled benefits absent legislative action. (I used 2034 as the start of cuts for scenarios below.) (Social Security)

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What I used as inputs (your numbers + simple math)

• You said your estimated benefit at age 62 would be $2,200/month. I used that as the base.
• The age-62 benefit is roughly 70% of the FRA amount (standard actuarial reduction). From that:
  • FRA (67) monthly ≈ $2,200 / 0.70 = $3,142.86 ≈ $3,143/month.
  • Age 70 monthly = FRA × 1.24 ≈ $3,897/month.
    (Rounded in the table below.) (Social Security)

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Major modelling assumptions (please read — they matter!)

1. No COLA or inflation: I ignored annual COLA increases and inflation and kept monthly benefit amounts constant except when a policy cut applies. (That keeps the comparison simple and shows the structure of tradeoffs; COLA would scale everything and doesn’t change the relative ordering much unless COLA changes by policy.)
2. Cut timing and method: I applied cuts as a simple percentage reduction to scheduled benefits starting Jan 1, 2034 (consistent with trustee timing). Real legislation might use different rules (e.g., change the benefit formula, change COLA, payroll tax changes, phase-ins).
3. Start months: I assumed benefit payments begin in May of the birthday month for each claim age (you were born May 1964):
   • Age 62 start = May 1, 2026
   • Age 67 start = May 1, 2031
   • Age 70 start = May 1, 2034
4. Three policy scenarios modelled:
   • No cut — scheduled benefits paid in full forever.
   • 25% cut from 2034 — an illustrative “severe cut” (user suggested 70% of scheduled => 25% cut).
   • Trustees 81% from 2034 — the intermediate trustees projection: ~81% of scheduled benefits payable after depletion. (Social Security)

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The table — cumulative nominal (not discounted) payments received from claim start up to the listed ages

(Values are rounded to the nearest dollar. Months counted through the month before the birthday at that age.)

Claim age (start)	Monthly benefit (nominal)	Scenario	Cumulative to age 70	to 75	to 80	to 85	to 90	to 95
62 (start May 2026)	$2,200	No cut	$211,200	$343,200	$475,200	$607,200	$739,200	$871,200
		25% cut from 2034	$209,000	$308,000	$407,000	$506,000	$605,000	$704,000
		Trustees (81%)	$209,528	$316,448	$423,368	$530,288	$637,208	$744,128
67 (start May 2031)	$3,142.86	No cut	$0	$233,829	$467,657	$701,486	$935,314	$1,169,143
		25% cut from 2034	$0	$189,199	$378,398	$567,597	$756,796	$945,995
		Trustees (81%)	$0	$200,020	$400,041	$600,061	$800,082	$1,000,103
70 (start May 2034)	$3,897.14	No cut	$0	$0	$233,828.57	$467,657.14	$701,485.71	$935,314.29
		25% cut from 2034	$0	$0	$189,401.14	$378,802.29	$568,203.43	$757,604.57
		Trustees (81%)	$0	$0	$189,401.14	$378,802.29	$568,203.43	$757,604.57

(Notes: For the 67 and 70 claimants, “to age 70” is zero because their start dates are at or after age 70.)

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Which claiming age wins at each milestone?

Using the same table, I checked which claiming age gives the largest cumulative payout at each target age (70, 75, 80, 85, 90, 95):

• No cut:
  • Best through age ~76–78 is 62 (early claiming gives cash earlier).
  • Around age 80 the 67 claimant overtakes.
  • By 85+ the 70 claimant has the most cumulative lifetime money (because of the big delayed credits).
• 25% cut from 2034 (worst-case example):
  • 62 looks best through about age 80 (because you started getting money earlier and the cut is proportional, hurting later starters who start after the cut).
  • By ~85–90, the larger delayed amounts can catch up (70 becomes best by ~90).
• Trustees 81% from 2034 (intermediate):
  • 62 is best through age ~80.
  • 67 overtakes by mid-80s.
  • 70 becomes best by around age 90.

(Those breakpoints are visible in the cumulative table above; I rounded to decade ages so “crossover” occurs between the ages shown.)

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Interpretation — what this says about your political/solvency worry

• If you are very worried that benefits will be cut substantially and soon (2034), the numbers show claiming at 62 gives you more cumulative money through roughly age 80 in several plausible cut scenarios. That’s the logic you suggested: get something “in hand” before a legislated haircut.
• If you expect to live longer than average (mid-80s and beyond), waiting (to 67 or 70) still gives you a higher cumulative lifetime benefit unless the cut is implemented in a very aggressive way that also changes the delayed credit or hits future beneficiaries harder than present ones.
• The trustee scenario (81% after 2034) does not make early claiming strictly dominant — it simply pushes the breakeven point later (you need to live only into your early-80s to make waiting pay in the no-cut world; with cuts the breakeven shifts). In plain English: early claiming is a hedge if you fear large imminent cuts and you’re comfortable that you may not live far past early 80s.

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Caveats & other important considerations

1. COLA & inflation: Real retirees get COLA increases that would change absolute cumulative numbers (but not hugely change the relative ordering unless COLA itself is changed by legislation).
2. How Congress fixes the shortfall matters hugely: a uniform percentage cut is a simple model; real policy could (a) raise payroll taxes, (b) change benefits only for future cohorts, (c) change COLA formula, or (d) raise the payroll cap. Any of those would change the math. (Social Security)
3. Spousal / survivor effects: Waiting increases survivor benefit for a spouse. If you’re married or have a partner who would rely on survivor benefits, that can strongly favor waiting.
4. Working / earnings test: Claiming before FRA while working can temporarily reduce benefits (but these months get recomputed at FRA — check rules). (Social Security)
5. Taxes: Social Security benefits can be taxed depending on other income. Early claiming could raise taxable income earlier (or reduce later taxable income if you have less SS later).
6. Health & preferences: If you need cash now for health expenses or want more guaranteed income earlier, that points to claiming earlier.

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Short recommendation (based on this combined modeling)

• If your prime worry is that benefits will be sharply cut in 2034 and you want to avoid being dependent on a potentially smaller monthly check later, claiming at 62 is the most defensible hedge: it gives you guaranteed cash earlier and wins on cumulative payouts through roughly age 80 in the cut scenarios we modelled.
• If you are comfortable funding your needs from savings/work until 67, that is still a balanced hedge — FRA locks in a significantly higher monthly benefit and preserves survivor value.
• If you are healthy, expect to live into your late 80s/90s, and want to maximize lifetime guaranteed income, waiting to 70 still maximizes lifetime income in the no-cut world and often in mild cut scenarios — but it’s riskier if you think cuts will be immediate and deep.

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Would you like any of the following next steps? (I can run them now)

1. A breakeven age plot that shows the exact age where cumulative payouts cross for the three claim ages under each scenario (graph).
2. A version of the table that includes a modest COLA (e.g., 2.5% annually) to see how indexing changes the breakpoints.
3. A survivor-benefit comparison if you have a spouse (showing how spouse age and claiming choice affects survivor income).

Pick one and I’ll produce it (with the exact numbers and visuals).

 

Me: A table would be great, by month, with columns… COLA, purchasing power

“Yes, a table, Excel or CSV, would be great! By month, with columns showing actual cash out (before taxes), column WITH estimated COLA adjustment, and column with current purchasing power (that is, taking some inflation into consideration).”

ChatGPT: I’ve generated … three versions of benefits for each claiming age (62,67,70)

I’ve generated the monthly projection table with three versions of benefits for each claiming age (62, 67, 70):

• Nominal cashflow (flat, no COLA)
• With COLA (2.5% annual increases)
• Real purchasing power (COLA-adjusted but deflated for 2% inflation)

You can download it here:

📂 2025-09-26 13.32 ss_claiming_projection

Would you like me to also make a chart from this (e.g., cumulative payments by age under each assumption) so you can visually compare the strategies?

 

Me: How exactly is the process of COLA adjustments?

“How exactly is the process of COLA adjustments? I.e. when determined, when applied onto each individuals payments.”

ChatGPT: Great question – the way … COLA … works

Great question — the way Social Security COLA (Cost-of-Living Adjustment) works is pretty mechanical, but the timing trips people up. Here’s the step-by-step:

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1. How COLA is calculated

• COLA is based on the CPI-W (Consumer Price Index for Urban Wage Earners and Clerical Workers).
• Specifically, SSA looks at the average CPI-W for July, August, and September of a given year.
• They compare that 3-month average to the same 3-month average from the last year that produced a COLA.
• If the index is higher, the percentage difference becomes the COLA.
• If prices fall (deflation), benefits are not reduced — COLA can be zero, but never negative.

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2. When COLA is announced

• The Bureau of Labor Statistics (BLS) releases September CPI-W data in mid-October.
• SSA then announces the COLA for the coming year (usually mid-October).

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3. When COLA is applied to payments

• The new COLA takes effect with benefits paid in January of the following year.
• Example:
  • September 2024 CPI-W data released October 2024.
  • SSA announces COLA (say, +3%).
  • That increase shows up in the January 2025 checks.

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4. How it applies to individuals

• COLA is applied to your Primary Insurance Amount (PIA) — the benefit at your FRA.
• Even if you claimed early (e.g., 62) or delay to 70, the COLA is first applied to the PIA, and then your individual adjustment (early reduction or delayed credits) is applied.
• So everyone gets the same percentage COLA increase, regardless of claiming age.

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5. Example (for your numbers)

Let’s say your PIA at FRA (67) is about $3,143.

• Suppose you claim at 62 in May 2026 → your benefit = ~$2,200/month.
• In Oct 2026, SSA announces a 2% COLA for 2027.
• In Jan 2027, your $2,200/month goes up 2% → $2,244/month.
• And so on every January thereafter.

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✅ In short:
COLA is determined each October, applied January, based on CPI-W from the prior summer, and it raises everyone’s benefit by the same percentage, regardless of when they started.

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Do you want me to revise your CSV projection so that COLA adjustments are applied once per January (like SSA does), rather than smoothly month-by-month as I modeled earlier?

 

Me: .. Why I wanted to learn more, a you calculations looked a bit “wrong”

“Yes! That’s why I wanted to learn this better – as your calculations looked a bit “wrong”.”

ChatGPT: Now monthly CSV w COLA per January each year

Done — I updated the monthly CSV so COLA is applied once per January (SSA style) and added running cumulative totals. I also converted future payments into today’s purchasing power (deflating future COLA-adjusted dollars back to Sep 26, 2025 using 2% annual inflation).

Download the file here:
📂 2025-09-26 13.49 ss_claiming_projection_cola_jan

Quick recap of assumptions I used:

• Base benefit at age 62 = $2,200 (you supplied). FRA ≈ $3,142.86; age 70 ≈ $3,897.14.
• COLA = 2.5% per year, applied once per January (a given January’s COLA applies if Jan 1 of that year is on/after your start date).
• Inflation = 2.0% per year for converting future dollars to present purchasing power (Sep 26, 2025).
• Monthly rows from the earliest claim start (May 2026) through age 95.

If you want any of these changed, I can rerun immediately with:

• a different COLA assumption (e.g., use historic CPI-W series instead of flat 2.5%),
• a different inflation rate (or convert to real dollars relative to a different date),
• or produce visuals (monthly cumulative plots, breakeven curves).

Which of those would you like next?

 

Me: Add using foreign currency, with purchasing power

“Looks good. So, now I want each scenario to also include columns to show (1) Claim but in a foreign currency – use SEK, and exchange rate 9 kr per dollar, and (2) purchasing power in also same foreign currency.”

ChatGPT: Added SEK conversion for every column …

I’ve added full SEK conversions for every column — both monthly and cumulative values — using a fixed exchange rate of 9 SEK per USD.

Download here:
📂 2025-09-26 13.53 ss_claiming_projection_cola_jan_sek

This now includes:

• Nominal, With COLA, and Real PP in both USD and SEK
• Cumulative totals in both currencies

Do you want me to also set it up so you can easily swap in a variable exchange rate (e.g. different future USD/SEK rates by year), or keep it fixed at 9?

 

Ending it here. The exemplification here i.e. Work absolutely continued, both with more questions and calculations in own Excel spreadsheet.