How Much Social Security Will I Get?
The amount of your Social Security benefit is calculated using your date of birth and the history of your earnings. There are certain things that will impact the amount of your benefit, including whether you make beyond a certain limit, are enrolled in Medicare Part B and/or have tax payments withheld.
- Written by Lindsey Crossmier
Lindsey Crossmier is an accomplished writer with experience working for The Florida Review and Bookstar PR. As a financial writer, she covers Medicare, life insurance and dental insurance topics for RetireGuide. Research-based data drives her work.Read More
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- Financially Reviewed ByBrandon Renfro, Ph.D., CFP®, RICP®, EA
Brandon Renfro, Ph.D., CFP®, RICP®, EA
Retirement and Social Security Expert
Brandon Renfro is a Retirement and Social Security Expert and financial planner. He focuses on helping clients create a secure financial future in retirement and co-owns Belonging Wealth Management. He is also a former finance professor and writes for several publications.Read More
- Published: March 6, 2023
- Updated: June 6, 2023
- 4 min read time
- This page features 5 Cited Research Articles
- Edited By
- Your date of birth and earnings history are the biggest factors in your Social Security payment.
- You can apply for Social Security between the ages of 62-70.
- If you apply early, you’ll receive a smaller benefit for a longer time.
- If you wait to apply, your monthly benefit will be larger.
What Affects My Social Security Payment Amount?
The two main elements that affect your Social Security benefit amount are your date of birth and the history of what you’ve earned. However, other factors can also influence the amount you will receive. Depending on when you apply, your benefit might be reduced if you enroll in Medicare Part B or continue to work and earn. Taxes can also be withheld from your benefit.
You can apply for Social Security benefits at any point between ages 62 and 70. The higher your age when you apply, the higher your monthly benefit will be.
Your benefit amount depends on several factors. The age at which you decide to claim your benefit has a significant impact, and you should consider your filing decision within the context of your total financial plan.
The year of your birth is important because Social Security is calculated based on your full retirement age, which is somewhere between 66 and 67 depending on when you were born. It is the point at which you are entitled to receive your full retirement benefits.
If you were born in 1956, your full retirement age is 66 years and 4 months. If you were born in 1960, it is 67 years. Before your full retirement age, your monthly benefit may be reduced if you continue to work. After your full retirement age, it will not.
You can apply for Social Security from age 62 until you turn 70. The earlier you begin to claim Social Security, the lower your benefit amount will be, and you will be locked into that rate.
However, the longer you wait to receive Social Security, the more your benefits will be. For example, if you wait until 70 years old to receive your benefits, you will receive the maximum benefit allowed.
Your compensation history is important because your earnings dictate how much you pay in Social Security taxes. The more you have paid into Social Security taxes, the higher your benefit will be up to a yearly maximum. The maximum is $4,555 per month in 2023, according to an article from the SSA.
Your benefit amount is based on your highest 35 earning years of work. If you worked for more than 35 years, the Social Security Administration (SSA) uses the top 35 years of your earnings. If you worked fewer than 35 years, the SSA enters $0 for any year without earnings, which will automatically lower your monthly benefit amount.
How To Calculate My Social Security Payment
The SSA calculates your benefit based on your earnings history. First, your 35 highest earning years are indexed for inflation, then added together and averaged. Next, that yearly average is divided by 12 to determine your monthly average. Finally, the SSA applies a formula to that monthly average to derive your Primary Insurance Amount (PIA), which is the amount of the monthly benefit you will receive at your full retirement age.
If you’d like to see an estimate of your PIA, then you can use the Social Security Quick Calculator. Note that the result is not a guarantee, nor is it your actual benefit. Instead, it is an approximation you can use when planning your retirement.
The table below shows the 2023 average and maximum monthly Social Security benefit depending on how old you are and when you file.
|Average Social Security Benefit||$1,827|
|Maximum at 62 Years Old||$2,572|
|Maximum At Full Retirement Age||$3,627|
|Maximum at 70 Years Old||$4,555|
When To Apply For Social Security
If you apply for Social Security at 62, you’ll get a smaller payment for longer. If you wait and apply at 70, you’ll receive a larger payment for a shorter time. But deciding when to receive benefits isn’t a one-size-fits-all decision. The best time to apply will depend on your individual situation.
For example, if you are in poor health, cannot continue to work or require Social Security to make ends meet, your best course might be to apply for Social Security as soon as possible. On the other hand, if you have the means to wait, applying at 70 to maximize your benefits might be a better option.
- If your general health is good, you may want to wait.
- Life Expectancy
- You can’t know your longevity for sure, but family history is a good indicator.
- Marital Status
- If one partner is still working, then marital status may affect your decision.
- Women tend to live longer than men, so it might be beneficial for women wait.
The specifics of your situation will determine the best age and/or time for you to apply for Social Security. If you have questions, don’t hesitate to talk to a trusted financial advisor or check with your local Social Security field office.
5 Cited Research Articles
- AARP. (2022, December 23). What Is the Maximum Social Security Benefit? Retrieved from https://www.aarp.org/retirement/social-security/questions-answers/maximum-ss-benefit/
- AARP. (2022, December 23). What Is My Social Security Full Retirement Age? Retrieved from https://www.aarp.org/retirement/social-security/questions-answers/social-security-full-retirement-age/
- SSA. (n.d.). Looking for a Local Office? Retrieved from https://www.ssa.gov/locator/
- SSA. (n.d.). Social Security Quick Calculator. Retrieved from https://www.ssa.gov/OACT/quickcalc/index.html
- SSA. (n.d.) Your Retirement Benefit: How It’s Figured. Retrieved from https://www.ssa.gov/pubs/EN-05-10070.pdf