3 Steps to Claiming the $4,873 Max Monthly Social Security Benefit

3 Steps to Claiming the ,873 Max Monthly Social Security Benefit

Here is some depressing information. In April, the monthly average Social security benefit was $1,915. On an annual basis, this represents almost $23,000. Few of us would consider this an income we could live off of in retirement – which is why it’s so important to be plan your retirement and save and invest for that too.

Remember, the $1,915 figure is just an average. Millions of people collect more than that, and a few manage to collect the Social Security maximum, which is $4,873 a month this year. It’s probably safe to assume that you won’t be able to get this maximum benefit, even if are ways to increase your Social Security benefits.

3 Steps to Claiming the ,873 Max Monthly Social Security Benefit

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Here’s an overview of the steps you’ll need to take to qualify for this maximum benefit of $4,873. You will need to do three key things.

1. Work for at least 35 years

This is perhaps the simplest requirement for most of us to meet: work for at least 35 years. For what? Well, the Social Security Administration (SSA) determines your benefit amount based on your earnings over the 35 years in which you earned the most (with earnings adjusted for inflation, of course). So if you’ve only worked for, say, 30 years, it will incorporate five years of zeros into its calculations. Even if you have worked 34 years, you will not be entitled to the maximum payment.

Note that once you to have worked for 35 years, if you earn significantly more (on an inflation-adjusted basis) than you did in the past, on average, it may be worth continuing to work for several years. In effect, each year of your now high income will eliminate the least earning year from the calculation, thereby increasing your benefits to some extent.

2. Earn the maximum for 35 years

This is the hardest qualification to obtain. You will need to earn a certain maximum amount during each of your 35 highest earning years. This amount, often called “maximum taxable income”, is determined each year by the SSA. For 2024, it’s $168,600 (compared to $160,200 in 2023 and $147,000 in 2022).

This $168,600 constitutes the income ceiling beyond which you are not taxed under Social Security. So if you and your neighbor earn $168,600 and $1,168,600, respectively, in 2024, you will both pay the same Social Security tax because income above that $168,600 is not taxed.

The sum of $168,600 also corresponds to the maximum salary taken into account when calculating your Social Security benefits. So, earning more than $168,600 in 2024 or more than $160,200 in 2023 will not increase your future benefits. But to maximize your benefits – to reach that high of $4,873 per month in 2024 – you’ll need to have earned at least this maximum amount during each of the 35 years which determine your benefits. See? This is a very significant obstacle for most of us.

3. Delay applying for benefits until age 70

Finally, there is this. You will also need to have delayed paying your benefits until age 70. This may seem like an easy thing to do, but at age 62, the earliest age you can start collecting benefits, you might really need that income. . Few of us know what our future holds.

Each of us has a “full retirement age” at which we can begin to receive benefits. complete benefits to which we are entitled based on our historical income. For most of us, that age is 66 or 67. (That’s 67 for people born in 1960 or later.) If you start collecting your benefits earlier, your benefit checks will be smaller, but you’ll collect a lot more. Delaying beyond your full retirement age will increase your benefit checks by about 8% per year until age 70.

See the table below, which shows the effects of starting controls earlier or later:

Start collecting at:

Full retirement age at 66

Full retirement age at 67




























Source: Social Security Administration.

Obviously you’ll get bigger checks by delaying, but delaying isn’t the best solution for everyone. When considering when to start Social Security, consider factors such as your retirement readiness and expected longevity.

So here’s how to qualify for this maximum benefit of $4,873, which will likely be even larger by the time you retire. Most of us won’t come close, but it’s still possible for most of us to take steps to at least somewhat increase our future benefits. And delaying collection remains a solid strategy for millions of people.

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3 steps to claim the maximum monthly Social Security benefit of $4,873 was originally published by The Motley Fool

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