The amount of your Social Security retirement benefit varies depending on how much money you made during your working years and whether you retire early.
When is the best age to retire? How much Social Security will I get? You may be asking yourself these, and many other questions, as you plan for retirement and your future financial needs.
The answer to those questions depends on your personal situation, but when you choose to start receiving Social Security benefits is ultimately up to you.
Social Security retirement benefits provide replacement income for qualified retirees and their families. Knowing how much Social Security you'll receive can help make planning for retirement easier, but getting an accurate estimate can depend on your retirement age, income on record, inflation, and other factors.
What is the Social Security retirement age?
The normal retirement age (NRA) is when your retirement benefits would equal the primary insurance amount (PIA). That is the benefit you'd receive if you elect to begin receiving benefits at your normal retirement age. In other words, your benefit is neither reduced for early retirement, not increased for delayed retirement.
Find your normal retirement age on the chart below:
Normal Retirement Age
Year of birth
1937 and prior
65 and 2 months
65 and 4 months
65 and 6 months
65 and 8 months
65 and 10 months
66 and 2 months
66 and 4 months
66 and 6 months
66 and 8 months
66 and 10 months
1960 and later
While many beneficiaries choose to wait until they reach NRA to retire, you don't have to. You can retire as early as age 62, called early retirement, but your benefit is reduced by five-ninths (5/9) of 1% for each month before NRA up to 36 months. If the number of months exceeds 36, the benefit is further reduced five-twelfths (5/12) of 1% each month.
Here is how that math looks in action. If your NRA is 67 and you retire at 62, you're retiring 60 months early and your benefit would be reduced by 30%.
You can also choose to retire later, called delayed retirement, and can earn extra credits toward your benefits up to age 69. You can earn an additional 3-8% depending on your birth year. That link will also show you how much your retirement benefit will be reduced for early retirement.
How are Social Security benefits calculated?
Social Security replaces a percentage of your pre-retirement income based on your date of birth and earnings history, as well as the age you retire.
The portion of your pre-retirement wages that is replaced is based on your highest 35 years of earnings and can vary depending on how much you earn and whether you retire at normal retirement age, retire early, or delay retirement. The amount you receive also depends on the amount of earnings that show on your record.
From your 35 best-paid years, Social Security produces what it calls your average indexed monthly earnings (AIME). They then apply a specific formula to the monthly average to determine your PIA. This formula breaks down your average monthly wage into three parts:
- 90% of the first $1,024 of your AIME
- Plus 32% of any amount over $1,024 up to $6,172
- Plus 15% of any amount over $6,172
The sum of these figures is your PIA. Then, the age at which you retire is taken into consideration.
Other things that can affect your benefits include:
- Whether you continue to work beyond your full retirement age, which can increase your future benefits
- The type of job you had, because some types of earnings have additional rules (like farm work, federal government employment, military service, self-employment, and others)
- Some pensions and taxes
Typically, the older you are when you start receiving benefits and the higher your income, the larger your benefit will be. However, Social Security does set a cap on how much of your income is considered when figuring out your benefit. In 2022, the cap is $147,000. Any income above that is not counted in your benefit calculation.
How to estimate how much Social Security benefits I'll receive
The best way to get an accurate estimate of your retirement benefits, based on your actual Social Security earnings, is by using a retirement benefits calculator. This is only an estimation, and your actual benefit amount can differ due to future increase or decreases in your earnings, cost-of-living adjustments, or other changes. However, it can be a great place to get started to understand what you could potentially get.
Or, log into your my Social Security account and get personalized estimates for age 62, full retirement age, and age 70. You can also view estimates by:
- Choosing a future age to begin receiving retirement benefits in years and months
- Choosing a future date to begin receiving benefits
- Entering the average annual income you expect to earn until retirement
You can also call the Social Security Administration (SSA) at 800-772-1213 to get a basic benefit estimate.
If you're calculating how much you'll receive, be sure to take into consideration Medicare premium deduction. Many retirees choose to have their Part B premiums deducted from their Social Security. In 2022, this is $170.10 per month. Be sure to subtract this from any retirement calculator estimates if you'll choose this option.
Supplementing Social Security benefits
On average, retirement beneficiaries receive 40% of their pre-retirement income from Social Security. In 2022, the average is about $1,657 per month, with the maximum benefit at $3,345 per month.
Depending on the lifestyle you plan for in retirement, you may not be able to rely on Social Security benefits as your only source of income. Many retirees must find ways to supplement their benefits to ensure their financial future is secure and their goals are met.
This could mean including the following strategies both before and after retirement:
- Contributing to an employer-sponsored retirement account, such as a 401(k) or 403(b)
- Contributing to a traditional or Roth IRA
- Building out an investment portfolio with assets like stocks, bonds, mutual funds, or CDs
- Establishing an emergency fund for unexpected and unplanned expenses
- Creating and sticking to a monthly budget, ensuring you're only spending what you need and putting the rest in a savings account or retirement fund
- Paying off debt as quickly as possible, and once paid off, adding those funds to a separate savings account
The important piece of being financially stable during retirement is to plan ahead. Consider your current lifestyle and any changes you'd like to make once you retire. Do you want to downsize your home? Travel more? Make any large purchases? Determining whether your average monthly spend will increase or decrease can help you learn how much income you'll need during retirement.
Then, estimate how many years you'll have post-retirement, and the average annual income you'll need to support yourself during those years. This can give you an idea for how much you'll need between Social Security benefits, retirement funds, investments, and savings.
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