My spouse is starting a new job and will be able to contribute to an HSA. I currently contribute the max amount allowed ($8300) into my HSA.
Either of us could contribute and reduce our social security earnings. This got me wondering how large of an impact this could have on our eventual social security Primary Insurance Amount (PIA). We are in our mid 30's so we don't know our exact future earnings but we are both in fields where we should have stable income.
I plugged both of our current and future estimated earnings into ssa.tools. My PIA is 3031 and my spouse's is 1904. I then lowered our future estimated earning to account for putting money into the HSA. My PIA would be 2974 if I made the contributions and my spouse's 1776 if she did.
I then plugged these numbers into opensocialsecurity.com. If my spouse made the HSA contributions instead of me it showed a present value of 418,508. If I make the contributions is shows a present value of 419,183. Very close, but in this scenario I should continue making the contributions.
There is a moderate chance my spouse will work less years than me so I changed her setting in ssa.tools to reflect her working 10 more years instead of 20. It gave her a PIA of 1403 if I make the HSA contributions and a PIA of 1342 if she does.
I plugged those numbers into opensocialsecurity.com. If my spouse makes the contributions, we have a present value of 400,962. If I make the HSA contributions the present value is 395,288. In this scenario, it would be better for my spouse to make the contributions.
This question is something that has been itching in the back of my head so it was fun to scratch that itch. The biggest thing this experiment showed me is it's not going to make a huge difference either way!
Has anyone else had this question?
If so, how did you go about figuring out an answer?
Anything that I'm missing?
Thanks!
Either of us could contribute and reduce our social security earnings. This got me wondering how large of an impact this could have on our eventual social security Primary Insurance Amount (PIA). We are in our mid 30's so we don't know our exact future earnings but we are both in fields where we should have stable income.
I plugged both of our current and future estimated earnings into ssa.tools. My PIA is 3031 and my spouse's is 1904. I then lowered our future estimated earning to account for putting money into the HSA. My PIA would be 2974 if I made the contributions and my spouse's 1776 if she did.
I then plugged these numbers into opensocialsecurity.com. If my spouse made the HSA contributions instead of me it showed a present value of 418,508. If I make the contributions is shows a present value of 419,183. Very close, but in this scenario I should continue making the contributions.
There is a moderate chance my spouse will work less years than me so I changed her setting in ssa.tools to reflect her working 10 more years instead of 20. It gave her a PIA of 1403 if I make the HSA contributions and a PIA of 1342 if she does.
I plugged those numbers into opensocialsecurity.com. If my spouse makes the contributions, we have a present value of 400,962. If I make the HSA contributions the present value is 395,288. In this scenario, it would be better for my spouse to make the contributions.
This question is something that has been itching in the back of my head so it was fun to scratch that itch. The biggest thing this experiment showed me is it's not going to make a huge difference either way!
Has anyone else had this question?
If so, how did you go about figuring out an answer?
Anything that I'm missing?
Thanks!
Statistics: Posted by slow n steady — Wed Jul 31, 2024 7:13 pm — Replies 1 — Views 189