One of the biggest factors determining your Social Security retirement benefit is how much you earn during your career. A long, high-paying career puts you one step closer to receiving the maximum possible monthly check once you claim benefits.
But retirees shouldn't discount the impact of claiming age in their decision. When you decide to start Social Security can have a massive impact on the size of your check too.
That discrepancy is magnified when comparing the maximum possible Social Security benefit at ages 62 and 70. Some retirees decide to split the difference and claim benefits at their full retirement age, which will fall between age 66 and 67 for readers.
Looking at the difference between the maximum monthly check at each of the above ages could help retirees decide when to start Social Security.
As mentioned, a long, high-paying career is necessary for anyone interested in the maximum Social Security benefit.
When the Social Security Administration goes to calculate your benefit, it takes a look at your entire earnings history. It adjusts all of your earnings from before you turned 60 for inflation, so they're comparable to your earnings from the year in which you turned 60. Any earnings after age 60 don't get an adjustment. It then selects the 35 highest-earning years and calculates your average income for your career.
That number then goes into the Social Security benefits formula to determine your primary insurance amount, or PIA. Your PIA is what you qualify for when claiming benefits at full retirement age. If you claim before reaching full retirement age, you receive less than your PIA. In other words, the longer you wait to claim, the larger your benefit will be (with a cap at age 70).
Collecting the maximum Social Security benefit does not require you to earn millions of dollars each year as there's an annual limit on the amount of individual wages the government taxes for the program. Any earnings above that amount won't incur Social Security taxes, but they also won't count toward your earnings history.
The Social Security Administration adjusts the amount each year for inflation. For 2024, anyone earning $168,600 or more paid the exact same amount of Social Security taxes. The limit for 2025 is $176,100.
Earning above the taxable limit for 35 years will put you in line for a sizable Social Security check when you retire. For reference, here's what the maximum taxable earnings have been over the last 50 years.