Every year, more than 5 million people start receiving Social Security benefits, and one of these days, you -- and I -- will join their ranks. (Perhaps you're already receiving them!) It's reasonable, then, to be wondering just how much you can expect. You might even be wondering what benefits used to look like. Read on, for some answers.
Image source: Getty Images.
Let's start with current benefits. As of November, the average monthly Social Security retirement benefit was $1,925, or about $23,000 annually. If that seems surprisingly low, know these things:
- If your earnings have been above average, your Social Security benefits will be above average, too.
- Benefits get revised annually, typically increasing via cost-of-living adjustments (COLAs).
- If you set up a my Social Security account, you'll be able to see estimates of your future benefits based on your earnings history.
- There are multiple ways to increase your benefits if you haven't claimed them yet.
The ways to beef up your benefits include increasing your income as much as possible while you're working and delaying starting to collect them -- until age 70, if possible. (For most of us, the best strategy is to wait until age 70.)
Social Security benefits of yore
Here's a look at how average benefits have changed over time:
|
Year |
Average Social Security Benefit for Retirees |
|---|---|
|
1964 |
$78 |
|
1974 |
$188 |
|
1984 |
$461 |
|
1994 |
$697 |
|
2004 |
$955 |
|
2014 |
$1,329 |
|
2024 |
$1,925* |
Source: Data source: Social Security Administration, 2023 Annual Statistical Supplement.
*As of November, 2024.
Clearly, benefits have been increasing substantially over decades. In fact, they've increased more than 10-fold in the 50 years since 1974! That's an underappreciated aspect of Social Security -- that it features inflation-linked adjustments every year, helping retirees preserve their money's purchasing power.
As you develop a thorough retirement plan, be sure to factor in Social Security benefits.
