Social Security’s Maximum $5,181 Benefit Is Set to Climb in 2027
Social Security's top monthly payout is already out of reach for most retirees, but a 2027 increase could make it even more worth chasing. Here is what it takes to qualify and what to do if you fall short.
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Living on Social Security alone can be a big challenge. The average monthly retirement benefit today is only $2,086, which amounts to roughly $25,000 on an annual basis. And given how costly basic expenses are today, it’s hard to get by on an income that size.
But some Social Security recipients today collect the program’s maximum $5,181 benefit. People in that boat can rely on Social Security for more than $62,000 a year.
Better yet, Social Security’s maximum monthly benefit is set to rise in 2027. And those eligible for it could be in line for a pretty nice paycheck.
Why the maximum Social Security benefit is expected to increase
As of this writing, we don’t know what Social Security’s maximum benefit will be in 2027. But the maximum benefit is expected to increase because Social Security is eligible for a cost-of-living adjustment (COLA).
We don’t know what that COLA will amount to as of right now. But current estimates put it in the 3.5% to 3.6% range.
If we take the lower number, it would add about $181 to Social Security’s maximum benefit, bringing that number up to $5,362. It also means that those eligible for Social Security’s highest benefit could enjoy an annual income of more than $64,000 in 2027.
How to score Social Security’s maximum benefit — and what to do if you can’t
To be eligible for the maximum monthly benefit Social Security pays retired workers, you need to do three things:
- Have a 35-year work history or more
- Have 35 years of earnings that equal or exceed the Social Security wage cap
- Delay your Social Security claim until age 70
You may be able to control the number of years you work and when you sign up for benefits. But maintaining high enough wages to meet or beat the wage cap for 35 years is a tall order.
For context, this year’s wage cap is $184,500. It’s been lower in the past, but it’s generally been a much higher number than the average wage. Earnings that exceed the wage cap aren’t subject to Social Security taxes and also don’t count toward future benefits.
If your earnings aren’t high enough to qualify for Social Security’s maximum benefit, there are other steps you can take to set yourself up with a nice amount of retirement income.
First, consistently fund an IRA or 401(k). The more time you give your money to grow, the more supplemental income you might have once your career wraps up.
Next, invest in assets that can pay you alongside Social Security in retirement. Those may include dividend stocks and ETFs and bonds.
Finally, if you can’t score Social Security’s highest possible benefit, do what you can to get the largest check possible based on your job situation. Grow your skills at work to snag raises, and delay your claim until 70 for a guaranteed boost compared to filing at full retirement age.
If you do these things, you may find that you’re able to enjoy a comfortable retirement income, even if Social Security’s maximum monthly benefit is off the table for you.
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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 Kiplinger.
Prior to becoming a full-time financial writer, Maurie worked in the financial industry trading distressed debt. She then changed course and spent a few years designing electronic toys. After a stint in content marketing and UX, she shifted back into writing and has since covered everything from the housing market to estate planning to Medicare.
When she's not busy writing, Maurie can be found hiking, walking her dogs, driving her kids to their various sports practices and games, and curling up with a good book. She cooks on occasion and bakes way too often.
