Your Social Security check will probably be one of your most important sources of retirement income, and with good reason. This money won't stop coming as long as you're still alive, and it reduces the effects of inflation with periodic cost of living adjustments (COLAs).
Since your retirement benefits will be instrumental in supporting you, don't make mistakes that inadvertently reduce them. You'll want to work enough years to avoid shrinking your monthly payments.
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How many years you need to work to avoid smaller Social Security benefits
If you don't want to shrink your monthly Social Security checks, your work history must span at least 35 years.
Benefits are calculated based on average monthly wages. The Social Security Administration (SSA) reviews your earnings record, adjusts annual wages for inflation, then calculates your average indexed monthly earnings (AIME). But only 35 total years are part of this calculation, regardless of how long you work -- specifically, your 35 highest-earning years.
If you worked for 40 years, this would mean your five lowest-earning years aren't part of your average, which helps you earn a higher monthly benefit. But if you work for fewer than 35 years, the SSA won't simply base your average on the number of years you actually did work. It'll just fill in the missing years with zeros. So if you worked only 30 years, you'd have five full years of $0 wages included in your calculation.
Obviously, the more zeros you include when calculating an average, the lower that average becomes. And since your Social Security checks equal a percentage of AIME, you'll shrink your benefit substantially when you don't have at least 35 years of earnings.
In fact, for many people, it's best to work longer than 35 years. If your work history spans exactly 35 years but two years were at the very start of your career and you earned the inflation-adjusted equivalent of around $10,000 annually, you'd have two years of $10,000 wages as part of your average. But if you're making $50,000 now and decide to work an extra two years, you can replace both of the $10,000 years with $50,000 years. This will bring up your entire average and result in more benefits.
You may not want to work for two more years just to get higher monthly Social Security checks. But delaying retirement can have a number of benefits, including giving you more time to save money and reducing the time your retirement investments must support you. If you can get more income from the SSA, fatten your nest egg, and maximize the chances you'll have plenty of money to see you through life, putting off retirement for a year or two may be the best move for you.
