What Is the Maximum Social Security Retirement Benefit?

The maximum Social Security retirement benefit that you can receive depends on the age when you start collecting and your earnings history, among other factors. In 2022, the maximum is $3,240 per month for someone who files at full retirement age (FRA) at age 66. But $4,194 is the absolute highest benefit for those who qualify and delay claiming until age 70.

How Social Security Benefits Are Calculated

Qualifying for Social Security in the first place requires 40 work credits or approximately 10 years of work. To be eligible to receive the maximum benefit, you need to earn Social Security’s maximum taxable income for 35 years. The cap, which is the amount of earnings subject to Social Security tax, is $147,000 in 2022, up from $142,800 in 2021.

Social Security benefits are calculated by combining your 35 highest-paid years (if you worked for more than 35 years). First, all wages are indexed to account for inflation. Wages from previous years are multiplied by a factor based on the years when they were earned. This calculation gives an amount comparable to buying power based on the current value of the dollar. Accounting for this valuation change is important because a salary of $14,000, for example, was far more impressive in 1954 than it is today.

Once all wages have been indexed, your average indexed monthly earnings (AIME) is computed by dividing the sum of all indexed wages by 420 (35 years expressed as months). If you worked fewer than 35 years, a zero is entered for years when you did not work. The benefit amount is then calculated based on factors that include the year when collection begins, whether you have reached FRA, and whether you continue to work while collecting benefits.

If you have 40 work credits, you are eligible to claim Social Security as early as age 62, but waiting until FRA will result in a much higher benefit. The most that you can receive in 2022 if you start collecting at age 62 is $2,364. Your FRA depends on the year of your birth. For example, if you were born in 1960 or later, your FRA is 67, and if you were born in the 1943–1954 years, it is 66. You will receive 100% of your benefits if you wait until your FRA to claim them. If you claim at age 70, vs. at FRA, you get an 8% bonus for each year that you delayed claiming.

Example of Maximum Social Security Benefits

Say that someone who turned 62 in 2021 will reach FRA at 66 years and 10 months, with earnings that make them eligible at that point for a monthly benefit of $1,000. Opting to receive benefits at age 62 will reduce their monthly benefit by 29.2%, to $708, to account for the longer time that they could receive benefits, according to the Social Security Administration (SSA). That decrease is usually permanent.

If that same person waits to get benefits until age 70, their monthly benefit increases to $1,253. The larger amount is due to the delayed retirement credits earned for the decision to postpone receiving benefits past FRA. In this example, that higher amount at age 70 is about 77% more than the benefit that they would receive each month if benefits started at age 62—a difference of $545 each month.

Of course, the best time for someone to start taking Social Security benefits depends on a variety of factors, not just the dollar amount of the benefit. Things such as current income and employment status, other available retirement funds, and life expectancy also must be factored into the decision.

Average Social Security Payment by Age

The average Social Security retirement benefit is significantly lower than the maximum. It was $1,563.82 per month in November 2021, according to the most recent data available from the SSA. Here’s what the average benefit looks like at different ages for those who started collecting at FRA, according to an annual report published by the SSA in 2021.

Source: Social Security Administration

To ensure benefits maintain their buying power, the SSA adjusts them every year in accordance with changes in the cost of living, For example, the cost-of-living adjustment (COLA) was increased by 5.9% for 2022, compared with a 1.3% increase for 2021.