Before you start thinking it's the norm to receive the maximum monthly Social Security benefit in retirement, think again: only a vanishingly small number of people actually accomplish the feat. But it is possible to know if you're on track to lock in the monthly max.
If you're not happy with where you are now, it's likely you have ample opportunity to (at a minimum) increase your projected benefit.
Here, we'll review the key markers for success when it comes to maximizing your Social Security checks.
You're a high earner
To earn enough qualifying credits to hit the Social Security maximum, you'll need to earn at least the maximum taxable Social Security wage base in your 35 highest-earning years. In 2022, the maximum wage base was $147,000, and in 2023, it's slated to spike up to $160,200. In other words, you'll need to earn at least these amounts (as well as several past and/or future inflation-adjusted amounts) to store the maximum Social Security credits.
Even if your current income doesn't approach these levels, any amount of income increase will help your Social Security outcome -- particularly if you're earning less than the maximum taxable wage base. This means that even small increases in salary or other income can have a lasting effect on the amount you ultimately collect in retirement.
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You're consistent
Not only will you need to be a high earner to score the Social Security max, but you'll also need to show that you've been one over a lengthy period of time. The Social Security Administration ("SSA") counts your 35 highest-earning years toward your personal benefit calculation. To be in the running, you'll need to have earned at least the maximum taxable wage base in all of your 35 highest-earning years. Simple, but not easy by any stretch.
Let's say you entered a high-paying career at age 30 and wanted to retire around age 60. Even if you were able to earn at least the maximum taxable wage base over a 30-year career, your overall projected benefit might be brought down by years of low or no income in your 20s. For people in this situation, working even half-time in your early 60s can help bring you closer to the maximum monthly payout (though, even still, you may fall short).
You're patient
On top of being a high earner over a 35-year span (or longer, depending on your income profile), you'll also need to delay filing your claim for benefits until age 70. A great number of factors might influence whether you're able to do this, including your accumulated savings at various ages throughout your 60s, as well as your health and the health of your spouse.
Even if you have the great fortune of working and earning a meaningful income for 30 years, you'll need to exercise patience when it comes to the timing of your claim. If you're particularly passionate about locking in the maximum Social Security benefit, you might consider working for a time in retirement to bridge the gap between the end of your formal career and the beginning of the Social Security stream.
Are you on track to hit the max?
Since we know that a mere 6% of workers earn the maximum taxable wage base in any given year, we can deduce that a much smaller percentage have done so for 35 years and delayed filing their claim for benefits. If you aren't close to hitting the requirements to collect the max payout, don't worry; there are still several options for making the most of your work history in retirement.
Above all, know that you can increase your projected benefit by either working more, working longer, earning more, or delaying your claim for benefits. There isn't any shame in earning a solid monthly check that falls short of the maximum, but be sure you know the levers to pull in the event you want a higher retirement insurance payout.
