This is a complex topic depending on whether the retiree is planning to collect SSA benefits on their own record or on a spouse’s record, as well as how many years they’ve worked paying into social security.
Retirees should call financial advisors, as the answers are pretty specific to an individual, and the advisors can refer them to the SSA for more detailed estimates.
The most common issue SMFR retirees face is the Windfall Elimination Provision – essentially a provision of social security that limits the ability of folks with a government pension to “double dip” by receiving both their pension (whether that is FPPA or the defined contribution 401a) and social security benefits.
The way the provision works, is that Social Security calculates a reduction of someone’s monthly social security benefit, based on the size of the government pension they receive, up to a max. Links to the SSA site with more info:
The most conservative assumption for a retiree that spent a substantial amount of their career at SMFR is to assume they will receive the maximum reduction in benefit allowed.
In 2021, the maximum reduction for the WEP is $498 per month
For example: if a retiree sees an estimate on their social security statement of $1,200 per month at full retirement age, the safe bet is to assume they receive only about $700/month ($1200 estimate less the maximum reduction of $498).
Folks with a shorter career at SMFR (or those who had substantial amounts of non-government wages in addition to SMFR from self-employment or part time work) may receive a reduction that is smaller, but financial advisors always say it is safe to aim low.