Comparing your retirement income to other peoples' income in retirement isn't always a fruitful exercise. After all, there's little that can be done about the numbers at that point. You may only end up frustrating yourself.
Still, perhaps there's some value in such an exercise, if only to know that you're not alone in being budget-minded.
With that as the backdrop, here's a rundown of how much retirees are collecting in Social Security benefits every month right now, broken down by age. Just keep in mind that these numbers will all be going up a bit in 2024, as the Social Security Administration adjusts for 2023's inflation.
Social Security retirement benefits by age
Actually, first things first... an important footnote.
The table below includes two different dollar amounts for each age. The first of these -- the smaller amount -- is the size of the average payments being collected by recipients who neither reduced their payment by retiring before their expected full retirement age (FRA), nor increased the size of their monthly checks by waiting beyond their FRA to file for retirement benefits. Most of Social Security's retirement beneficiaries take this option.
The second column of the table reflects the typical payments being collected by individuals who racked up delayed retirement credits by waiting longer to claim their benefits than they had to. While waiting longer increases the eventual size of your checks, bear in mind that these people are collecting these payments for a shorter period of time. This crowd represents a minority of Social Security recipients, although it's hardly a tiny minority.
You'll also want to remember that these are just averages with a wide range of underlying numbers. The biggest factor affecting your Social Security retirement payments is still the amount of taxable income earned while working.
On that note, the data in the table speaks for itself.
| Age | Average Monthly Benefit Without Delayed Retirement Credit | Average Monthly Benefit With Delayed Retirement Credit |
|---|---|---|
| 66 | $2,007.68 | $2,415.07 |
| 67 | $2,052.69 | $2,369.56 |
| 68 | $2,031.64 | $2,410.41 |
| 69 | $2,004.36 | $2,455.25 |
| 70 | $2,029.16 | $2,841.54 |
| 71 | $2,023.60 | $2,811.83 |
| 72 | $2,011.23 | $2,785.72 |
| 73 | $2,037.00 | $2,820.46 |
| 74 | $2,079.46 | $2,827.69 |
| 75 | $2,086.57 | $2,749.04 |
| 76 | $2,125.78 | $2,737.15 |
| 77 | $2,089.82 | $2,611.40 |
| 78 | $2,101.77 | $2,557.63 |
| 79 | $2,120.73 | $2,515.41 |
| 80–84 | $2,099.35 | $2,248.42 |
| 85–89 | $1,876.40 | $2,001.19 |
| 90 or older | $1,558.02 | $2,122.90 |
Source: Social Security Administration. Numbers are for 2022.
There are a couple of details worth drawing out here. The first is an explanation of how 66- and 67-year-olds are collecting beefed-up monthly payments due to delayed retirement when the current full retirement age is 66 or 67 (depending on when you were born). The explanation is, these FRA figures are relatively new and still phasing into effect. For people born before 1954 and 1960 who are only now reaching their initially intended retirement age, the old FRA rules still apply. There aren't many of these people, though, as most of this crowd opted to retire without tacking on more credits linked to the postponement of benefits.
And the second nuance worth pointing out?
While the dollar amount of the monthly payment is about the same for retirees not benefiting from delayed retirement credits, there's a clear swell in the size of the checks being cashed by retirees who put off filing for benefits until they turned 70. This is what you'd expect to see given that these monthly payments get bigger when initiating them at that age, but they don't get any bigger by waiting beyond that age to claim benefits.
Finally, not shown on the table are the retirees who began collecting Social Security benefits well before their full retirement age. The earliest this is possible is at the age of 62, but doing so reduces your benefits by about 30% of what you're due at your FRA. The reduction is phased down as you near 66 or 67 years of age. Even so, it's a choice that can prove very costly in the long run... particularly if continuing to work at that time of your life is an option.
Options for subpar Social Security retirement benefits
But you've already begun collecting Social Security checks that aren't going quite as far as you hoped they would? Don't sweat it too much, for a trio of reasons.
One of these reasons is that you may be able to suspend these payments and then restart them later at a bigger amount once you turn 70.
There are some consequences -- although nothing that could be considered an outright penalty -- for making such a decision, not the least of which is the loss of what may be much-needed income in the meantime. You might need to go back to work. It may well be worth it, though, particularly if doing so gives you a chance to sock some more serious money away in a retirement account.
If that's not a viable option, also consider the possibility of scooping up more dividend stocks and living on the income they generate. Obviously this strategy requires some careful planning; you may also need growth. But most investors should be able to find at least a slightly higher-yielding balance of growth and income then they're presently achieving.
Image source: Getty Images.
Finally, if your Social Security checks just aren't stacking up, consider going back to work without stopping your retirement benefit payments.
This could reduce the size of your monthly benefit if you're not yet at your full retirement age. In 2023, the Social Security Administration reduced benefit payments by $1 for every $2 earned above $21,240 worth of annual work-based income for working folks who had not yet reached their FRA. The number's being raised to $22,320 in 2024.
Even then, though, this reduction isn't simply lost. The Social Security Administration recalculates your future benefit payments when it imposes these reductions, giving you credit for them to be collected later over time. And if you have reached your full retirement age, working doesn't reduce your Social Security retirement benefits at all. It could even bolster them, if you end up earning enough.
Look beyond Social Security
Perhaps the most important takeaway here, however, isn't where you stand (or will stand) in comparison to other Social Security retirement beneficiaries. Rather, it's that nobody's exactly getting rich from this government-run entitlement program. Even the folks taking home 2024's maximum-sized Social Security checks will still only be collecting $4,873 per month. That's not a ton of money. Never even mind the fact that very few retirees will actually qualify for that amount.
Assuming you've still got some time and options left, the lesson to glean from this look at the numbers is that you really need to save as much as you can for as long as you can, and not plan on making Social Security the centerpiece of your retirement plans.
If you need help getting started with such a plan or you want to adjust your plan now that you're retired, the Motley Fool's got plenty of insights to offer.
