It’s the question every Boomer needs to answer. Rich or poor. Whether you’ll need Social Security to make ends meet or whether you intend to use it to fund an investment program for yourself or, say, your grandkids’ education. Or anything else in between.

Unfortunately, the answer to that question is complicated. The accumulation phase is more or less automatic; the distribution phase is not automatic. Add to this the Crash of 2008 and the answer becomes more important than ever.

The decisions you make at this stage in life depend on a multitude of factors including income, assets, health status, life expectancy, family dynamics, life goals, and a lot more.

And unlike a lot of other decisions you made earlier in life, some decisions you will be forced to make now are irreversible. For instance:

• Starting Social Security at age 62 can cause a you to leave a lot of money on the table if you live well into your 90s.
• Failure to consider the impact of marriage, divorce, remarriage, and widowhood can severely pinch your  lifetime stream of income…
• Failure to coordinate IRA RMDs with Social Security taxation results in needless reduction of income that could be put to better use for health care or just enjoying life.

There are literally millions of permutations. For every rule of thumb, there are dozens of exceptions. And here’s the key: there really is no substitute for sitting down with an advisor, spreading the papers around the table, and talking about your life and family, hopes and fears, and developing a retirement plan that makes all aspects of your financial and life goals work together.

Social Security is a lot more valuable than most people realize. Here are a few things to consider. FIrst, it is a lifetime annuity. Once you start getting it, it keeps coming until you die. Second, it’s inflation-protected. A nice benefit, indeed, thanks to annual cost-of-living adjustments (COLAs).  With the power of compounding, these annual bumps can really start to add up over the years. This aspect is often overlooked by individuals and advisors. Third, there is right of survivorship. So when one spouse dies, the other can continue to receive the higher of the two benefits until they die, too.

Consider this example. In 2008, the maximum benefit for a person turning full retirement age is $2,185 per month. If that person lives for 30 more years, assuming an annual cost-of-living adjustment of 2.8% (which is what Social Security trustees project under their intermediate-cost scenario), he or she will collect more than $1.2 million in benefits. In addition, “retirement,” or whatever it may be called in the future, will be different for the Boomers.

We already know that. Youth was different. Marriage is different. Career paths are different. Recreation is different. Health is different. Longevity is different. Religiosity is different. It keeps going.

So when it comes to figuring out Social Security, that’ll be different, too. Unlike previous generations, they won’t just pad on down to the local Social Security office and sign up. Everyone wants to know how to get the most out of their Social Security. It’s a perfectly natural response, especially when someone actually looks at what they’ve paid in over the years.