Social Security

[lockets]

Looking at this table, if I make less than these amounts in my top 35 years of working, my social security payout will be less than what it could be when I retire, correct? In other words, I have to make over these amounts for my top 35 working years to max out on the social security benefit I will receive? I know that the year that I claim social security also makes a difference, I'm just trying to isolate the earnings-to-benefits part of it for now to better understand it and how I could positively impact the future to make sure I'm not under-earning.

https://www.ssa.gov/oact/cola/cbb.html

Edited to fix spelling.

 

[starry_solo]

Check your yearly SSA statements. That's what I do

 

[RamblingMad]

There are three bends. The bend amounts change every year. Basically take your social security earnings (from the SSA site), divide by 35, and then divide by 12 to get your monthly number. Then use the bends published by the SSA to get your approximate benefit in today’s dollars.

My goal is to maximize my second bend. That means today I need my 35 yearly average income to be $80,652.

https://www.ssa.gov/oact/cola/piaformula.html

 

[georgina]

Looking at this table, if I make less than these amounts in my top 35 years of working, my social security payout will be less than what it could be when I retire, correct? In other words, I have to make over these amounts for my top 35 working years to max out on the social security benefit I will receive? I know that the year that I claim social security also makes a difference, I'm just trying to isolate the earnings-to-benefits part of it for now to better understand it and how I could positively impact the future to make sure I'm not under-earning.

https://www.ssa.gov/oact/cola/cbb.html

Edited to fix spelling.

That chart shows the maximum salary level that is taxed for SS. I'm not aware it says anything about your benefits.

 

[LuvOrlando]

The fastest way to get an answer is to make an appointment with them and ask.

 

[_19disnA]

The chart provided by the OP shows the max income each year for which you will pay tax into Social Security while working. Earnings from your job are only taxed up to those amounts. There is a SS website where you can see your own infomation of what they show your income has been over the years. The amount of your SS benefit will depend on your highest 35 yrs of income as well as when you start to collect it.

 

[lockets]

Thanks for the responses! I have my most recent statement so it does lay it all out for me re: what I will get as a benefit as things stand right now.

I noticed it said that my amount is calculated based on my top 35 years of income. That led me to the chart I linked above to see if there’s a way I can max out my top 35 years to get the highest benefit possible eventually. Know what I mean?

I guess as long as i try to make more than the amounts listed on the link then I’m maxing it out in terms of paying into it and not leaving money on the table later on.

Not sure if I have that logic right?

 

[RamblingMad]

Thanks for the responses! I have my most recent statement so it does lay it all out for me re: what I will get as a benefit as things stand right now.

I noticed it said that my amount is calculated based on my top 35 years of income. That led me to the chart I linked above to see if there’s a way I can max out my top 35 years to get the highest benefit possible eventually. Know what I mean?

I guess as long as i try to make more than the amounts listed on the link then I’m maxing it out in terms of paying into it and not leaving money on the table later on.

Not sure if I have that logic right?

Take your current average per the SSA site’s earning history. Add up the earnings they have for you and divide by 35. You want to increase that average. The incremental impact is figured out from the PIA calc I linked above.

If this math is too hard, the SSA have calculators you can use. But you have to manually input all of your earnings.

https://www.ssa.gov/oact/anypia/anypia.html

 

[lockets]

Take your current average per the SSA site’s earning history. Add up the earnings they have for you and divide by 35. You want to increase that average. The incremental impact is figured out from the PIA calc I linked above.

If this math is too hard, the SSA have calculators you can use. But you have to manually input all of your earnings.

https://www.ssa.gov/oact/anypia/anypia.html

Ok got it thank you!

 

[tvguy]

Thanks for the responses! I have my most recent statement so it does lay it all out for me re: what I will get as a benefit as things stand right now.

I noticed it said that my amount is calculated based on my top 35 years of income. That led me to the chart I linked above to see if there’s a way I can max out my top 35 years to get the highest benefit possible eventually. Know what I mean?

I guess as long as i try to make more than the amounts listed on the link then I’m maxing it out in terms of paying into it and not leaving money on the table later on.

Not sure if I have that logic right?

The statements lay it all out for you. I never paid attention to my earnings when I was working and their impact on my Social Security. I will reach my full Social Security retirement age of 66 1/2 in December. My highest earning year was 2020, and my Social Security will be with in a few dollars of what my take home pay was in 2020. I retired in July 2021 and have been living off savings. I will have paid into Social Security for 50 years, but that includes years like 1973 when I was 16 and had about $1,100 in earnings for the year.

 

[Robber Baron]

The fastest way to get an answer is to make an appointment with them and ask.

Gotta tell you, and it suprised me.

Every single SSA employee I have ever talked to on the phone, or met with, has been very helpful, friendly & knowledgeable.

Call them or make an appointment.

 

[tvguy]

Gotta tell you, and it suprised me.

Every single SSA employee I have ever talked to on the phone, or met with, has been very helpful, friendly & knowledgeable.

Call them or make an appointment.

That was my experience too. When my MIL's husband died, her third husband, they made sure she was not entitled to benefits from her two ex-husbands, to make sure she got the biggest benefit check she could. She even talked to my MIL on the phone to explain to him why she needed his Social Security number to check if the woman he had been divorced from for 30 years was entitled to benefits from his account, and that if she was, it would not reduce his Social Security benefit.

 

[focusondisney]

I guess as long as i try to make more than the amounts listed on the link then I’m maxing it out in terms of paying into it and not leaving money on the table later on.

Forget about that link unless you have 35 years to work before taking SS. If you want your maximum benefit, make sure any years you have remaining to work are your highest income years. If you’re part time, try to work more hours. Work overtime if you can. Get a job with higher pay. Don’t volunteer to take unpaid time off (yes, that is a thing at some jobs).

If you want to know approximately what your monthly payment will be, check the SS.gov website or make an appointment with an agent. Don’t forget Medicare & taxes gets taken out every month. The figure they give you is before those deductions.

 

[focusondisney]

I retired in July 2021 and have been living off savings. I will have paid into Social Security for 50 years, but that includes years like 1973 when I was 16 and had about $1,100 in earnings for the year.

Well, it will be 50 years since you first started paying into SS. Technically you will only have paid into it for 47.5 years. You haven’t been paying into it between your retirement in July 21 & December 23.

 

[tvguy]

Well, it will be 50 years since you first started paying into SS. Technically you will only have paid into it for 47.5 years. You haven’t been paying into it between your retirement in July 21 & December 23.

And you left out the Survivors Benefits I drew from 1967 to 1978.

 

[goofyernmost]

The statements lay it all out for you. I never paid attention to my earnings when I was working and their impact on my Social Security. I will reach my full Social Security retirement age of 66 1/2 in December. My highest earning year was 2020, and my Social Security will be with in a few dollars of what my take home pay was in 2020. I retired in July 2021 and have been living off savings. I will have paid into Social Security for 50 years, but that includes years like 1973 when I was 16 and had about $1,100 in earnings for the year.

I don't remember the exact wording but my recollection is that they look at the last three(?) earning years and base the SS rate on those amounts. I doesn't matter how little you made when you were starting out.

 

[tvguy]

I don't remember the exact wording but my recollection is that they look at the last three(?) earning years and base the SS rate on those amounts. I doesn't matter how little you made when you were starting out.

Yes. That sounds correct. We maxed out IRAS for a few years, and then when 401k's became into existence, maxed those out and that was what we planned our retirement income to come from. But Social Security is much larger than I ever expected, so we may soon stop withdrawals from our IRAs except in emergencies.

 

[john7994]

I don't remember the exact wording but my recollection is that they look at the last three(?) earning years and base the SS rate on those amounts. I doesn't matter how little you made when you were starting out.

Found here ...
https://www.ssa.gov/oact/cola/Benefits.html

 

[focusondisney]

And you left out the Survivors Benefits I drew from 1967 to 1978.

Again, you weren’t paying in until you started working. So you still didn’t pay in for 50 years.

 

[tvguy]

Again, you weren’t paying in until you started working. So you still didn’t pay in for 50 years.

Actually, it will be 50 years. Because of mistakes made by my former employer they sent me checks for money that somehow got lost in the 401k plan in both 2022 and in January of this year and they withheld tax and Social Security.