The maximum monthly Social Security retirement amount payable in a year generates a lot of interest. Here is the 2016 amount.
To be clear, this will be the maximum amount payable to a person retiring exactly at full retirement age (FRA) in 2016.
This is not the same as the highest possible Social Security retirement amount.
The full retirement age is 66 for people born in 1943 – 1954. When retirement benefits start before FRA, the FRA amount is reduced by the number of months involved. When retiring after FRA, benefits increase by the number of months past FRA.
The maximum monthly Social Security retirement amount changes each year. Several issues cause this including national average wage information and having another year of potentially higher earnings available when computing retirement benefit amounts.
A first step in determining a retirement amount is to compute the person’s amount at full retirement age, without reductions or increases. Social Security uses the person’s best 35 years of earnings, weighted for inflation to do this.
To compute the amount for the person’s actual retirement date, Social Security adjusts the full retirement age amount by the number of months that the person wants to start benefits before FRA. When retirement benefits start before FRA, the amount is reduced. To see a chart showing reduced benefits, visit www.socialsecurity.gov/planners/retire/agereduction.html.
When retiring after FRA, the amount is increased. More about these increases, called delayed retirement credits, is located at http://www.socialsecurity.gov/planners/retire/delayret.html .
So, what is the maximum 2016 Social Security retirement amount?
If starting Social Security retirement in 2016 exactly with the month of reaching full retirement age, and if the person earned at least the maximum Social Security taxable earnings in each of the 35 years used in the calculation, then the highest 2016 Social Security retirement amount is $2,639 per month. You can find the maximum taxable earnings for each year at http://www.socialsecurity.gov/planners/retire/maxtax.html.
The estimated average SSA retirement amount for all workers as of January 2016 is $1,341 per month.
If you want to estimate your own retirement benefit, you can use the Retirement Estimator at www.socialsecurity.gov/retire/estimator.html. The Retirement Estimator uses your actual Social Security earnings. Estimates are shown for age 62, your full retirement age, and age 70. You can use the Estimator to find estimates at other ages or using additional estimated earnings.
Want to see the earnings on your Social Security record? You should since your retirement is based on them. Create a personal my Social Security account and view your online Social Security Statement. The Statement provides your earnings record with family estimates for SSA retirement, survivors and disability benefits. Sign up for your own my Social Security account today at www.socialsecurity.gov/myaccount.
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