High hurdles mean the vast majority of retirees get less than the maximum benefit.
The wealthiest Social Security beneficiaries are taking home a record $4,873 per month in 2024, up from $4,555 per month last year. That kind of money could support a pretty comfortable retirement, especially when paired with personal savings.
But claiming checks this size is quite rare. In reality, the average benefit is only about $1,911 per month, as of Feb. 2024.
It all comes back to how the Social Security benefit formula works. Below I’ll discuss how the government calculates your benefits, why most people get far less than the max, and what you can do to increase your checks.
What do you have to do to get the largest Social Security benefit?
There are three boxes you must check to claim the maximum Social Security benefit. First, you must work for at least 35 years.
The government looks at your income during your 35 highest-earning years when calculating your benefit. If you work less than 35 years, the formula fills in a zero for any year you have no income, and just one zero-income year is enough to take the largest Social Security benefit off the table.
But the second box is what knocks most people out of the running: You have to earn the maximum income subject to Social Security taxes (also known as the contribution and benefit base) for at least 35 years. In 2024, that means earning $168,600 or more.
This figure has risen over the years — it was $117,000 a decade ago and $76,200 at the turn of the century. Those were still high hurdles to clear at the time though, and earning less than the contribution and benefit base in even a single year again takes the max benefit off the table.
Finally, you must wait until age 70 to apply for Social Security. This is when you become eligible for your largest monthly benefit due to the accumulation of delayed retirement credits. Keep in mind this is not the same as full retirement age (FRA), which is the age when you become eligible for your full benefit based on your work history. You can sign up at FRA or as early as 62, but you won’t be eligible for the maximum check in those scenarios.
How can you maximize your Social Security checks?
Though it may be impossible for most people to get the $4,873 benefit due to the high-income requirements, you can still leverage the information above to maximize your checks:
- Aim to work for at least 35 years, if possible: This will prevent zero-income years from reducing your benefit.
- Do what you can to boost your income today: If you’re earning less than the maximum income subject to Social Security tax, anything you do to increase your taxable income can boost your checks in retirement.
- Choose the best Social Security claiming age for you: Think about what makes sense, based on your health and finances.
The first two are fairly self-explanatory, but choosing the best Social Security claiming age can be tricky. Generally speaking, most people get their largest lifetime benefit by delaying Social Security until age 70. But this isn’t always possible.
Some people don’t expect to live much beyond 70, and such individuals will get more by claiming early. Others might want to delay Social Security, but they can’t work or afford to cover their living expenses in the meantime. In this case, claiming early could be essential to staying out of debt, even if it means settling for a smaller lifetime benefit.
These are personal factors you’ll have to weigh when deciding when you’d like to sign up. Explore a few options, and plan for the claiming age you think makes the most sense to you right now. You can always pivot if circumstances change down the road.
Finally, keep a close eye on changes to the Social Security program. It’s likely the government will make some alterations in the coming years to address Social Security’s funding crisis, and this could affect your claiming strategy too.
