Are you planning for retirement? You may be wondering how much you will actually get in Social Security benefits. There are a few key factors to determining what your monthly payment will be. Here we’ll discuss how you can calculate how much Social Security you’ll receive when you retire.
Calculating Your Benefit Payment
According to the Social Security Administration, the average monthly retirement benefit for Social Security recipients is currently about $1,976 in 2025. This number is based on how many years you worked and at what age you collect your Social Security. The Social Security Administration will “index” earnings to reflect the change in general wage levels that occurred during the worker’s years of employment.
According to the SSA, “up to 35 years of earnings are needed to compute average indexed monthly earnings. After we determine the number of years, we choose those years with the highest indexed earnings, sum such indexed earnings, and divide the total amount by the total number of months in those years. We then round the resulting average amount down to the next lower dollar amount. The result is the AIME. Then we would compute the AIME and use this amount in computing the worker’s primary insurance amount.” You can use this table to see the benefit amounts based on AIME. You can also use this calculator to estimate your benefit payment.
You’ll be eligible to collect your Social Security payment at age 62, but waiting to collect may mean that you’ll get a bigger payout. If you wait till your full retirement age, which is currently age 67, you’ll receive 100% of your full benefit. Take a look at this breakdown of payments based on when you start collecting. As you can see, your payment will go up with each month you wait to claim your benefits.
Should You Wait to Collect?
You can start to collect your Social Security as late as age 70 and as early as 62. Whenever you start to collect, you’ll receive your monthly payments for life. If you want to retire early, you may need this monthly income sooner than your full retirement age. While your monthly payment will be much less, you’ll collect for longer than if you wait. You could receive years of benefits before you even reach your full retirement age. In the long run, this may be more beneficial than waiting for a larger payment.
While you can start collecting at 62, many people wait. In fact, if you start claiming at 62, you’ll receive about 30% less each month. So if your full retirement benefit is $2,000 by claiming it at 62, you’ll only receive $1,400 each month. By age 67 or the full retirement age, you’ll have collected about $84,000. While there is no right answer as to when you should start receiving benefits, it’s important to plan accordingly.
If you need additional help estimating your Social Security payment, you can always visit your local Social Security office or contact the SSA online.
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Teri Monroe started her career in communications working for local government and nonprofits. Today, she is a freelance finance and lifestyle writer and small business owner. In her spare time, she loves golfing with her husband, taking her dog Milo on long walks, and playing pickleball with friends.
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