The typical retiree currently receives around $1,627 per month from Social Security. A benefit boost by $1,830 would more than double that typical payout, which would be an incredible windfall. While it is possible for some retirees to see a swing of as much as $1,830 in their potential monthly benefit check, it's a pretty rare occurrence. Indeed, if it's something you want for yourself, it's something you need to plan out well in advance to make happen.
You see, that $1,830 per month is the difference between retiring with the maximum possible benefit at 62 ($2,364 per month) and retiring with the maximum possible benefit at 70 ($4,194 per month). So if you want to score that extra $1,830 per Social Security check, all you need to do is qualify for the maximum benefit, and then wait for age 70 to collect it.
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The factors that count
Even if completely maxing out Social Security is not in the cards for you, there's still value in understanding the factors in play to get you there. After all, doing what you can to increase the value of your Social Security check still gets you a larger monthly payment, even if that increase doesn't get you all the way to the absolute max.
In that vein, there are three factors that matter the most: the number of years you work, your covered wages each year, and the age at which you claim benefits. Knowing how those three factors work together will help you decide how to plan between now and when you do retire to get the most out of the check you'll receive from the program.
Years you work: Your highest 35 years of covered income, indexed for the average wage rate for the year, count toward your benefit amount. Work less than 35 years, and you'll have some $0 years on your record. Work more, and your lower-income years will be overwritten by your higher-income years.
Your covered wages: Every year you work in a covered job, your salary up to a cap -- $147,000 in 2022 -- gets used in calculating your benefit amount. It's not a dollar-for-dollar increase, however. Social Security uses bend points in your salary when determining your benefit. The net impact is that the first dollar you earn is each year is generally worth more to your benefit than the last dollar you earn, particularly if you are on the higher end of the salary curve.
The age you claim: You can claim your Social Security retirement benefits at any time, beginning as early as your 62nd birthday. The later you wait -- up until age 70 -- the higher your monthly benefit amount will be. Somewhere between those two -- age 67 for anyone born in 1960 or later -- is your full retirement age. That's the age you would get exactly your primary benefit amount. Claiming earlier gets you less money for more months, while claiming later gets you more money for fewer months.
In addition to the reduction in your monthly benefit amount, Social Security also penalizes you if you're below your full retirement age, collecting benefits, and still working. In 2022, that penalty is as much as $1 for every $2 you earn above $19,560 in the year. As a result, you should only claim your Social Security benefit before your full retirement age if you're certain you're done working or really won't have any other way to cover your basic costs of living.
Get started now
As long as you're under age 70 and haven't started to collect your benefits, you still have the opportunity to increase your potential Social Security check. Whether or not you'll be able to qualify for that full $1,830 increase, you can still take actions to earn a little more, work a little longer, and/or wait a bit later to claim. The moves you make on that front can very well lead to a higher monthly benefit for you when you do claim.
The thing to remember, however, is that each of those factors are influenced over the course of years. So if a larger monthly Social Security check is something you'd like to see, get started on your plans now. The sooner you get started, the more of that precious time you have on your side, and the bigger the impact you can have on what you ultimately get from the program.
