And the figure it gives you is in today's dollars or future dollars?
Social Security goes up by the (COLA) rate of inflation every year. So if you calculate it in today's dollars, that's what it will be worth in inflation adjusted future dollars. In other words, it might say $3500/month today, but the real payment will be $4300, but because of inflation that $4300 will only be worth $3500: the amount they are showing today.
However I have discovered what appears to be an exception when talking about delaying payment beyond your full retirement age. What my parents have seen is that their SS estimate went up every year until they reached age 66 - full retirement age. After that point it went up 8% a year regardless of inflation. So if the inflation is 0%, who cares, you get your 8% increase. However suppose inflation is 4%. You do not get 4% plus another 8% for delaying a year. You
only get the 8% increase, which is now only worth 4% because of inflation.
I could be wrong, but that's what my parents were seeing in the real world. Because of this, they ended up taking one at 66.5 and the other taking spousal, then switching to individual at 68.5 because the way the math worked out, delaying any longer than that was on the "wrong side" of the odds for payback before dying.
I too use a spreadsheet in LibreOffice for estimating my future social security payment. Granted, if you do it you'll need to grab the historic inflation tables, your income history, and update it yourself every year, but I view that as good and valuable work that's worth doing every year anyway. Besides, everyone should be checking their SS annually to make sure it matches their tax statement. If you don't get that fixed right away if it's wrong, you risk going into retirement having missed out on some income because of an employer understating or underpaying your SS taxes.
One last thing on that subject of taxes: if you have more than a million dollars in a pre-tax account like a 401k, IRA, or anything subject to RMDs, it might be worth your while to get really involved with your after tax estimates. Social Security is generally tax-free income
except if your income goes beyond $25,000 as an individual or $32,000 as a couple. There's rules and math involved, but even just at age 70, the RMD on $1MM is about $58,800 and if you're also getting $3200/month ($38,400 total) from Social Security, that's $97,200 all together. That's clearly more than $25,000. Double everything if you're a married couple each collecting a similar SS and RMD amount, but in the worse situation of having only a $32k threshold, not $50k. If you're married but filing separate it drops to $0 before you pay taxes on SS income.
You might find that it's to greater tax advantage to take SS earlier. The earlier you take SS, the less you need to pull from your own retirement accounts, which might be taxable events anyway. This would be especially true if you're doing a Roth ladder to move the maximum amount possible from your taxable accounts to a Roth account every year in order to tax shelter that money. Putting off both your SS and RMDs until age 70 might mean you are simply setting yourself up to pay a crapload more money in taxes at that point.
Everyone's situation is a little different, but it may be well worth your while to look in to it. At the very least, if you're retiring at age 56, you should start going over tax options using your new free time. Becoming a master at tax strategy is one of your new side jobs at that point, and it may very well pay you thousands of dollars a year for the rest of your life by doing it well.
