Do you think you have a chance of one day getting the maximum Social Security benefits? Sorry to say, but you probably don’t.
The biggest monthly check you can get from Social Security is $4,194 in 2022. The benefit is adjusted for inflation, so in most years the maximum benefit increases. But very few people will earn enough in their career to reap the maximum benefits.
Here’s how much you need to earn to get the biggest Social Security checks.
How to get a social security check for $4,194?
If you don’t earn at least $147,000 in 2022, you’re not on track to get the maximum Social Security benefit. Winning over $147,000? Don’t party yet.
Social Security bases your benefits on your best 35 years of earnings. To get the biggest checks possible, you need to earn at least the maximum Social Security taxable income for at least 35 years. In 2022, this amount is $147,000. It increases almost every year.
Here are the maximum Social Security taxable earnings from 2015 to 2022.
|Year||Maximum taxable earnings|
Here’s how it works: You pay 6.2% on the taxable minimum. Your employer corresponds to this 6.2%. But anything you earn over that amount doesn’t go into Social Security coffers. So even if you make $1 million in 2022, your Social Security income is $147,000.
Meanwhile, failing to hit taxable pay in a single year out of 35 years of earnings will result in a check below the maximum. Even the highest paid people often don’t get that level of pay early in their careers. That’s why it’s so hard to get a $4,194 monthly check from Social Security.
Less than 20% of workers will earn more than the taxable maximum in any year during their lifetime. Your chances of earning the maximum taxable in a given year? Only about 6%.
It’s not just about your salary
But earning at least the taxable maximum isn’t enough if you want to maximize your Social Security check. You will also have to wait until age 70 to collect. To benefit from your full benefits, you must wait until full retirement age (FRA). It’s 67 if you were born in 1960 or later, although you can get benefits from age 62, but for a reduced amount.
To maximize your check, you should take advantage of the 8% Deferred Retirement Credits you earn for each year you maintain past full retirement age until your benefits cap at age 70. receive a maximum benefit of only $3,345.
Is it worth getting the maximum Social Security check?
If you’ve earned enough in the last 35 years to collect the maximum Social Security check, you’re probably not doing it for the purpose of maximizing your Social Security benefits. In this scenario, you probably have significant savings and are not dependent on Social Security for a significant portion of your retirement income.
But if your retirement savings are insufficient, maximizing your Social Security as much as possible is a good goal. The longer you wait, the greater your profit. You can also get more money if you are able to replace income from a lower paying year with income from a higher paying year.
Delaying retirement, even for a year or two, can make a significant difference to your retirement budget. Not only can you earn more Social Security money while you wait, but you can also allow your investments to accumulate a little longer by deferring your withdrawals.
Social security is an important source of income for older people, but ideally it is only one source of income among others. Regardless of your retirement plans, very few people should expect to receive the maximum benefits.