The maximum Social Security benefit in 2022 is $4,194. But don't get excited at the idea of receiving $50,328 per year in Social Security income. Chances are you aren't going to get anywhere near this amount.
There are two big reasons why the typical American is going to fall far short of Social Security checks that top $50,000 a year.
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Your salary probably isn't nearly high enough to max out your benefits
The first big reason your benefit is likely to fall short of the $4,194 max Social Security benefit is because you probably won't earn anywhere near the salary you'd need to in order to get such a large monthly check.
Every retiree's benefits are calculated using a formula that gives them a percentage of their average wages earned during their 35 highest-earning years (after wages over their career are adjusted for inflation). Income up to a "wage base limit" counts when average wages are determined.
The "wage base limit" is set each year, adjusting upward to account for inflation. It's a specific income threshold above which income isn't taxed and isn't included in your benefits formula. To earn a $4,194 Social Security check, your earnings must equal or exceed the wage base limit for a minimum of 35 years so you can get the highest average wage.
The table below shows what that limit is this year and in the recent past. Looking at the table, it should quickly become clear why you probably aren't getting the $4,149 benefit. To earn it, you would need a very high salary for a very long time.
| Year | Wage Base Limit |
|---|---|
| 2022 | $147,000 |
| 2021 | $142,800 |
| 2020 | $137,700 |
| 2019 | $132,900 |
| 2018 | $128,400 |
| 2017 | $127,200 |
| 2016 | $118,500 |
| 2015 | $118,500 |
| 2014 | $117,000 |
| 2013 | $113,700 |
Table created by author. Table source: Social Security Administration
The bigger the gap between your salary each year and the wage base limit, the more your own benefits will fall short of the $4,194 maximum benefit. And the more years you earn less than the wage base limit, the bigger the gap between your own benefits and Social Security's max benefit.
You're probably going to have to claim benefits before you can max them out
If your earnings equal or exceed the wage base limit during 35 years or more, don't get excited just yet about receiving the $4,194 max benefit. You have one more hurdle to accomplish.
You must wait until the age of 70 to claim your first Social Security check, even though you could start these checks at 62.
The table below shows the most popular Social Security claiming ages, based on past data from the Center for Retirement Research. Full retirement age (FRA) is the age when seniors can start their checks to receive their standard benefit based on average wages.
|
Age |
% of women who first claim benefits at that age |
% of men who first claim benefits at that age |
|---|---|---|
|
62 |
40% |
35% |
|
63 |
8% |
7% |
|
64 |
8% |
7% |
|
65 to Full Retirement Age |
12% |
13% |
|
Full Retirement Age |
16% |
23% |
|
Full Retirement Age to 69 |
9% |
11% |
|
70 or later |
7% |
5% |
Table source: Center for Retirement Research
As you can see, only a very small percentage of people end up waiting until age 70 to first start their Social Security checks. There are myriad reasons for this, most centered around the fact that the majority of people must retire prior to 70 due to health issues or unemployment and can't survive on savings alone without retirement benefits to supplement it.
The problem is, earning the $4,194 maximum would require you to wait until 70 to get your first check because you must increase your standard benefit as much as possible to earn such big checks. To bump up your standard benefit as much as possible, you'll need to earn every delayed retirement credit available to you. These credits increase your standard benefit amount by 2/3 of 1% per month for each month between FRA and 70 that you forgo getting checks.
Chances are good you won't max out your delayed retirement credits or earn the maximum taxable wage for 35 years or more. So it's very likely your monthly Social Security checks won't come close to the $4,194 max benefit. And that's OK, as long as you plan ahead for what your own benefits are likely to be and save enough that you can live on those benefits when combined with retirement account withdrawals.
