The Social Security Administration (SSA) has issued its Monthly Statistical Snapshot for November 2023, and the latest average monthly retirement benefit has risen to $1,845. That might look reasonable at first glance, but multiply it by 12 and you'll see that it's only $22,140 over the course of a year.
But that's just an average. Tens of millions of recipients will be receiving more, and sadly, tens of millions will be receiving less.
It's critical to understand, though, that you're not doomed to only receive a certain benefit in retirement. For one thing, benefits are increased regularly via cost-of-living adjustments (COLAs). On top of that, there are actions you can take to increase your Social Security benefits.
Image source: Getty Images.
A look at the most important Social Security table you'll ever see will make that clear.
The most important Social Security table you'll ever see
Before we get to the table, understand that each of us has a full retirement age -- the age at which we're eligible to collect the full benefits to which we're entitled, based on our earnings history. For most people, it's 66 or 67, and it's 67 for those born in 1960 or later.
Each of us can start collecting our Social Security retirement benefits as early as age 62, though. Start the checks flowing early, and they will be smaller, but you'll receive many more of them. Conversely, for every year beyond your full retirement age that you delay starting to collect Social Security (up to age 70), your benefits will increase -- by about 8% per year.
So, behold the most important Social Security table. It shows what percentage of your full retirement benefits you'll receive, depending on when you turn on the spigot:
|
Start Collecting at: |
Full Retirement Age of 66 |
Full Retirement Age of 67 |
|---|---|---|
|
62 |
75% |
70% |
|
63 |
80% |
75% |
|
64 |
86.7% |
80% |
|
65 |
93.3% |
86.7% |
|
66 |
100% |
93.3% |
|
67 |
108% |
100% |
|
68 |
116% |
108% |
|
69 |
124% |
116% |
|
70 |
132% |
124% |
Data source: Social Security Administration. Table by author.
What the most important Social Security table means for you
So how should you use that table? Well, let it inform your thinking about Social Security and your decision regarding when to start collecting Social Security. It can influence your overall retirement plan too, as you determine how much income you'll need in retirement and how much you should be saving now.
Note that while delaying will make your checks bigger, starting early can be the best move for many people. If you simply need the income as soon as possible, or you stand a decent chance of living a shorter-than-average life, starting early can make plenty of sense. But for those who can delay, it's worth considering doing so.
The table is also a good reminder that to a meaningful degree, the ultimate size of your Social Security benefit check is within your control. Timing when you start receiving your checks is one way to influence the size of your checks.
Another effective strategy, especially if you're still many years from retiring, is to try to earn more. In general, the more you have earned in your working life, the bigger your benefits will be, up to a limit. (For 2024, the maximum monthly benefit is $4,873, or about $58,500 annually. It's very hard to attain that, though.)
If you're not already doing so, be sure to spend time planning for your retirement. There's much more to that than just Social Security, since Social Security is likely to only provide a fraction of your needed income. Most of us need to be saving sufficiently and investing effectively for retirement. And if we're far from where we should be, we might consider delaying retirement for a few years. That can be a very powerful financial move.
Your future financial security may depend on your taking certain actions now, so don't procrastinate tending to your financial health.
