The Max Social Security Check Is $5,181 a Month and It Only Goes to People Who Wait Until 70
Social Security's top monthly payout sounds simple to qualify for, but the requirements go far beyond just being patient enough to wait. Most retirees discover too late that their working years already made the decision for them.
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The average monthly Social Security benefit among retirees today is about $2,086. That amounts to roughly $25,000 a year, which is hard to live on.
But some retirees are eligible for $5,181 a month in Social Security. And on an annual basis, that’s more like $62,000 a year, which could actually make for a decently comfortable lifestyle.
But most Social Security recipients are not eligible for $5,181 a month. There’s a reason for that.
Holding off until 70 matters
To qualify for Social Security’s maximum benefit of $5,181, you need to delay your claim until age 70. Most recipients don’t do that.
Social Security benefits can be claimed starting at age 62. And you’re eligible for your monthly benefits without a reduction once you reach full retirement age (FRA), which is 67 if you were born in 1960 or later. Each year your claim is delayed past FRA boosts your monthly checks by 8%, up until age 70.
For many seniors, waiting until age 70 to claim benefits just isn’t feasible. A lot of people end up retiring sooner due to health issues, job loss, or the need to be a caregiver to a loved one. That’s part of the reason Social Security’s maximum benefit is out of reach for most recipients.
A $5,181 monthly check requires more than just waiting
It’s also important to understand that waiting until age 70 to claim Social Security isn’t enough to score $5,181 per month. That maximum only applies to people who satisfy the program’s highest benefit requirements.
Someone with average or modest wages won’t qualify for Social Security’s maximum benefit. To get it, you need annual wages equal to or higher than the program’s wage cap, which changes yearly and is currently $184,500.
Also, Social Security calculates your monthly benefits based on your 35 highest-paid years of wages. What this means is that you need your income to match or exceed the program’s wage cap for a full 35 years in order to qualify for the largest benefit payment possible.
If you earn a super-high salary for 30 years but a lower wage for five years, you won’t get the maximum benefit. And you don’t get credit for wages beyond the annual cap in your benefits formula. So if you earn $500,000 a year for 30 years and $40,000 a year for five years, that maximum benefit may still be out of reach.
All of the right pieces need to come together
Getting Social Security’s top benefit means earning a high salary throughout your career and having the ability and patience to wait until age 70 to file. For the typical retiree, that’s not attainable.
But even if your wages aren’t high enough to get Social Security’s maximum benefit, there’s a valuable lesson here — waiting past FRA to file could still pay off big time. Even if you’re only eligible for half of Social Security’s maximum benefit, filing at 70 instead of 67 boosts that monthly check by 8% for life.
So if you don’t need to file for Social Security right away, hold off until 70, or as long as you can. The upside could be substantial and make a big difference in your retirement finances on a long-term basis.
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Maurie Backman has more than a decade of experience writing about financial topics, including retirement, investing, Social Security, and real estate. Her work has appeared on sites that include The Motley Fool, USA Today, U.S. News & World Report, and CNN Underscored.
