Here’s How It Works: How to Plan for the $4,194 Monthly Social Security Maximum


According to the Social Security Administration (SSA), the average monthly Social Security benefit for retired workers was $1,665.18 in March. However, if you meet certain requirements, you may be eligible for a monthly benefit of up to $4,194.

It is easier said than done to qualify for the maximum monthly benefit, but there are steps you can take to increase the amount you will receive from the program during your non-working years. Here’s what you need to know to make the most of your Social Security benefits.

social security

Make the most of your earnings over the 35-year calculation period.

The calculation of your average indexed monthly earnings (AIME) over your 35 years of highest income will be the first step in determining your Social Security benefit. In most cases, this means having at least 35 years of earnings to base the AIME calculation on, because even a few years without earnings will have a significant impact on the benefit you receive.

To be eligible for the $4,194 maximum monthly benefit, you must be in the maximum taxable income bracket for Social Security for the duration of your AIME period. That means having at least $147,000 in average, inflation-adjusted earnings over your 35 highest years of earnings. For context, the Social Security Administration estimates that only 6% of Americans meet the annual income requirement each year.

If you are earning significantly more later in life, it may be in your best interest to work for an additional year to increase your AIME. You will also be on the path to the benefits that come with deferring benefits beyond your initial eligibility at age 62 and then beyond your full retirement age (FRA).

Wait until you’re 70 to start receiving benefits.

Delaying when you take Social Security benefits has advantages and disadvantages. The chart below shows full retirement ages by birth year, as well as the amount your benefit will be reduced if you begin taking Social Security at initial eligibility rather than waiting until your FRA.

The Social Security Administration is the source of the data.

Even if your average earnings over the 35-year calculation period put you in or above the maximum taxable earnings bracket of $147,000, taking Social Security at 62 will result in a monthly payment amount that is up to 30% lower than if you waited until full retirement age. That means the maximum monthly Social Security benefit you can receive if you begin collecting at the age of 62 is $2,364. Furthermore, if you choose to postpone taking benefits until you reach full retirement age, your benefit will be increased. The graph below shows the percentage increase based on when you choose to take Social Security after FRA. 0fMqfSOp00

The Social Security Administration is the source of the data. Author’s chart

To receive the maximum monthly benefit of $4,194, you must have a FRA of 66, meet the maximum taxable income requirement, and wait until the age of 70 to begin receiving Social Security.

Consider your personal situation when approaching Social Security.

Although very few people will meet the taxable income requirements to qualify for the maximum Social Security benefit, everyone can use the same basic guidelines to plan for their own retirement. It’s generally best to maximize your earnings over the calculation period, and then weigh the benefits and trade-offs of when to take them.


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Delaying Social Security can result in a significant increase in the amount you receive monthly, but you will also miss out on benefits in the meantime. Your health, financial situation, and other factors should all be considered when deciding on the best approach for you.

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