Comparing your past, present, or future retirement income to others' earnings isn't always a fruitful exercise. You may not be able to do much about it anyway. And there's always more to the story. Someone else may still be paying off enormous loans, for instance, while a lower-earning person could be completely debt-free.
Nevertheless, such comparisons can help you figure out where you stand financially. They usually satisfy your suppressed curiosity as well.
Here's a closer look at how much the average retiree is taking home -- or will take home in the future -- in Social Security payments.
How you're doing
The table below lays out the size of the average monthly Social Security check current retirees are cashing or depositing each and every month. Retirees in their 60s are making a median of $1,457 per month, while retirees over the age of 90 are taking home just a little over $1,600 per month.
| Age Group | Median Monthly Social Security Payment |
|---|---|
| 60-69 | $1,457 |
| 70-79 | $1,681 |
| 80-89 | $1,671 |
| 90 and older | $1,601 |
Data source: Social Security Administration.
Surprised to see the biggest checks not coming from either extreme end of the range?
It actually makes sense when you give it a little thought. The longer you can wait -- and the older you are -- before you start collecting your Social Security retirement benefits, the bigger your payments will be. Younger retirees are banking less per month, but they'll likely do so for longer.
Meanwhile, the very oldest retirees aren't doing quite as well as retired folks in their 70s and 80s, but they started their benefits payments at a time when wages were relatively lower even after adjusting for inflation. The after-the-fact way that cost-of-living adjustments are calculated puts older retirees at a slight disadvantage every time they're implemented.
If you're not yet retired
But if Social Security payments are only in your distant future, where can you expect to stand compared to your peers then?
Coming up with such comparisons is tricky because they require projections based on numbers that can (and likely will) change between now and then.
It's still possible to come up with some plausible, in-the-ballpark estimates, though.
That's what the table below does, with some things to keep in mind. First, the dollar amounts are in today's dollars rather than future dollars. Second, the presumed age Social Security benefits will start being collected is 66 years old. And third, the estimates presume annual wages will grow as these hypothetical people age and gain more valuable work-related experience. In other words, the average 25-year-old earning on the order of $35,000 per year today will be earning the inflation-adjusted equivalent of $55,000 at 55 years old. Earning more or less than these median amounts will of course raise or lower future payments.
| Current Age |
Current Median | Estimated Future Monthly Retirement Benefit |
|---|---|---|
| 25 | $35,000 | $1,579 |
| 35 | $52,776 | $2,041 |
| 45 | $57,000 | $2,055 |
| 55 | $55,000 | $1,853 |
Data sources: U.S. Census Bureau and Social Security Administration. Estimated calculations by author via SSA.gov.
As always, claiming early will dramatically reduce the size of these monthly payments, while waiting until you're older to start your benefits will push these future Social Security payments much higher. For perspective, although the average monthly Social Security check for those who have reached their full retirement age of 66 (or 67, depending on your birth year) is $1,782, it's on the order of 30% less for those starting benefits at the age of 62. Holding off until you're 70 years old to claim Social Security's retirement benefits will beef that amount up by nearly 25%.
By the way, you can get a detailed, personalized benefits projection from Social Security. You just have to set up an account with the organization's website.
Good to know, but this is only the beginning
Shocked? Depressed? Maybe elated to learn you're doing better than average?
Be wary of becoming too emotional about any of it. Doing better than your peer group's average still doesn't inherently mean you'll be able to maintain your current standard of living when you retire. Social Security is only meant to complement the retirement income you generate from your own savings. As such, the benchmarks above are only a starting point to a more complete financial plan.
All the same, starting somewhere with any benchmark is better than not starting at all.
If you don't quite know how or where to get started building such a plan, we recommend going here first.
