Many Americans file for Social Security retirement benefits without maximizing their potential payout, missing out on substantial funds. By understanding how the Social Security system works, you can significantly increase your monthly benefits, even if you don’t reach the highest possible payment of $4,873.
Steps to Achieve the Maximum Social Security Payment
To receive the highest Social Security payment of $4,873, you need to meet strict criteria. The Social Security Administration (SSA) requires workers to have earned the “taxable maximum” for 35 years. Below are recent taxable maximum figures:
- 2015: $118,500
- 2016: $118,500
- 2017: $127,200
- 2018: $128,400
- 2019: $132,900
- 2020: $137,700
- 2021: $142,800
- 2022: $147,000
- 2023: $160,200
- 2024: $168,600
(Source: SSA Link)
Earning this amount for 35 years is challenging for most, as it not only requires a high salary but also that all jobs be covered by SSA. If your employment isn’t covered, you won’t be eligible for these benefits.
Timing Matters: File at Age 70
Even if you meet the income requirement, the timing of your claim also plays a crucial role. Filing at age 70 allows you to take full advantage of “delayed credits,” which can increase your benefits by about 8% per year after reaching your Full Retirement Age (FRA).
For example, while those filing at FRA can receive a maximum of $3,822 per month, waiting until age 70 can push that amount to $4,873. If you file at age 62, the earliest age you can claim, your benefits could drop to $2,710.
Key Takeaways for Maximizing Your Benefits
- Work for 35 years in jobs covered by the SSA.
- Earn the taxable maximum each year.
- Delay your claim until age 70 to maximize delayed credits.
By following these steps, you can significantly increase your monthly Social Security payment and secure a more comfortable retirement.