Social Security, the nation’s retirement system, accounts for at least half the monthly income of 61 percent of retired workers. Of the 61 million monthly beneficiaries, 68 percent are retired workers. Another 10.5 million are disabled, 1.6 million are children of qualified disabled people, and six million are surviving relatives. That’s a lot of people, but how much do they collect?

The Average Retirement Benefit

Most people look at Social Security as retirement income. As Americans plan for retirement, it helps to know how much they can plan to receive. The nearly 42 million retired workers collecting a monthly check from Social Security receive an average payment of $1,368.67, or about $16,424 per year.

The Maximum

Instead of aiming for the average, why not think bigger? The maximum benefit as of 2017 is $3,538. That’s twice as much as the average, so why not aim for a check of that size? Because you would need to earn $127,200 per year for the 35 years prior to your retirement, and that’s only possible for a small portion of the population. However, there are things you can do to earn a larger check.

Waiting Longer Pays Off

Depending on your birth year, you have a certain age at which you will collect full benefits. If you start taking Social Security earlier than your full retirement age, your checks will be smaller because you will collect more checks over your lifetime. If you were born before 1937 your full retirement age is 65. If you were born after 1960 it’s 67, and if you were born in between those years it’s between 65 and 67.

One of the reasons that the average Social Security retirement benefit amount is so far from the maximum is because the largest number of Americans begin receiving benefits as soon as they’re allowed—at age 62. In fact, 42 percent of men and 48 percent of women begin collecting benefits at 62. Thirty-four percent of men and 27 percent of women collect benefits between the ages of 65 and 66, and only 2 percent of men and 4 percent of women start receiving checks at 70—the maximum age after which benefits no longer increase.

If you can delay benefits until after your full retirement age, you receive about an 8 percent increase each year up to 70. But if you follow the plurality and collect benefits at 62, your checks are an average of 25 percent smaller than if you had waited until your full retirement age.

But Not Always

Waiting to collect obviously does not make sense if you’re in poor health. Two other reasons to file sooner:

  • You have young children who might be eligible for benefits.
  • It makes sense for your spouse to file for spousal benefits sooner.

That’s when you can use the help of a financial advisor (see below).

Check Your Statement

If you feel like Social Security is one big guessing game, it doesn’t have to be. The program has a variety of calculators to give you an idea of what you’ll earn. If you want a more exact figure, sign up for a My Social Security account. There you can view your current benefit based on your contributions to date and Social Security’s calculation of your past income.

You Need a Plan

If the average Social Security retirement benefit sounds unimpressive, remember that Social Security is meant to supplement the money you’ve set aside for retirement—likely earned through a qualified retirement plan such as a 401(k), individual retirement account or other tax-advantaged account. People who rely solely on Social Security will find themselves struggling in retirement. That’s why it’s crucial to appropriately save while you’re able to work.

If you don’t have a retirement savings plan in place, talk to a financial advisor. A professional can look at your current assets and create a savings and investment plan that will get you to retirement in good shape.



Compare Popular IRA Providers

Provider Fidelity Investments Merrill Edge
Name Fidelity Roth IRA Merrill Edge IRA E*Trade IRA
Description Get a range of investment choices, tax advantages and 1:1 help with a Fidelity Roth IRA Learn More Get up to $600 when you invest in a new Merrill Edge IRA. Plus one-on-one guidance, actionable insights and easy-to-use tools. Learn More Invest for retirement at E*TRADE. Learn More