Key Steps to Receive $4,873 from Social Security in Retirement – Essential Actions You Should Take

Social Security benefits are a crucial part of retirement planning for millions of Americans. While many retirees receive modest payments, a select few can receive up to $4,873 per month in 2024. This article looks into the essential steps required to maximize your Social Security retirement benefits and who qualifies for these top-tier payments. With upcoming payments scheduled for August 14, 21, and 28, it’s important to know how to secure the highest possible payout.

Benefits

Contrary to popular belief, not everyone qualifies for Social Security retirement benefits. These benefits are reserved for individuals who have worked in jobs covered by the Social Security Administration (SSA) and have paid payroll taxes. If your work history includes jobs that did not pay into Social Security, you will not be eligible for retirement benefits from the SSA.

For those who do qualify, Social Security can provide substantial financial support in retirement. However, the amount you receive depends on several factors, including your age at the time of filing, your earnings history, and the number of years you have worked. In 2024, the maximum monthly benefit is $4,873, but only for those who meet strict criteria.

Eligibility

To receive up to $4,873 per month from Social Security, you must follow specific steps. The most crucial steps involve delaying your retirement and ensuring a robust earnings history over your working years.

Step 1

The first and most significant step to maximize your Social Security benefits is to delay filing for benefits until you reach 70. While you can start receiving benefits as early as age 62, doing so will significantly reduce your monthly payment. For example, if you qualify for the maximum benefit but file at age 62, your payment could be reduced to around $2,710 per month. Even if you wait until your Full Retirement Age (FRA), typically between 66 and 67 depending on your birth year, the maximum benefit is still capped at $3,822 per month.

By delaying your retirement until 70, you take full advantage of delayed retirement credits, which increase your benefit amount for each year you wait beyond your FRA. This delay is key to receiving the highest possible Social Security payment.

Step 2

The second critical requirement is your work history and earnings. To qualify for the maximum benefit, you need to have worked for at least 35 years in jobs covered by Social Security. The SSA calculates your benefit amount based on your highest 35 years of earnings. If you have worked fewer than 35 years, the SSA will include $0 earnings for the missing years, which will lower your average and, consequently, your monthly benefit.

In addition to working for 35 years, you must earn the taxable maximum for each of those years. The taxable maximum is the highest amount of income on which you pay Social Security taxes, and it changes annually to reflect inflation and wage growth. In 2024, the taxable maximum is set at $168,600. This means that to qualify for the maximum benefit, you must have earned at least $168,600 annually for 35 years in jobs that contribute to Social Security.

Key Considerations

While delaying retirement and maintaining a consistent, high income are critical, it’s also important to stay informed about annual changes to the taxable maximum and consider the potential impact of Cost of Living Adjustments (COLA). COLA increases can raise both the taxable maximum and your benefits, but they also make it more challenging to meet the earnings requirements as time progresses.

Achieving a monthly Social Security benefit of $4,873 is a lofty goal, requiring a long and successful career with steady, high earnings. However, with careful planning and a strong knowing of how Social Security benefits are calculated, it’s a goal that is attainable for some.

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