- List your yearly earnings. Your Social Security benefit is based on your average indexed monthly earnings (AIME).
- Adjust earnings to account for inflation. If you have earnings decades in the past, the SSA increases these amounts so that all income is expressed in today's dollars.
- Add up your income for the 35 highest years. Social Security benefits are based on your average earnings for 35 years of work.
- Divide your total by 420. Once you've totaled your 35 highest-earning years, get the average by dividing that total amount by the number of months in 35 years, which ...
- Check your figure with the SSA's quick calculator. Once you've done the calculation yourself and understand how the AIME formula works, you can use the calculator available on the ...
How do you determine your Social Security benefit amount?
- For earnings that fall within the first band, you multiply by 90%. That is the first part of your benefit.
- For earnings that fall within the second band, you multiply by 32%. That is the second part of your benefit.
- For earnings that are greater than the maximum of the second band, you multiply by 15%. This is the third part of your benefit.
How do you estimate your Social Security benefit?
Key Points
- Social Security benefits may not be as high as you think.
- The average benefit is going up in 2022.
- Your benefit could be above or below average, depending on your wages over your career.
How to calculate your projected Social Security benefit?
- For every dollar of average indexed monthly earnings up to $926, you’ll get 90 cents per month in benefits.
- For every dollar of average indexed monthly earnings between $927 and $5,583 you’ll get $.32 cents per month in benefits.
- For every dollar of average indexed monthly earnings beyond $5,583 you’ll get $.15 cents per month in benefits.
What is the formula to determine social security?
With that in mind, the 2019 formula is:
- % of the first $926 of AIME.
- % of AIME greater than $926, but less than $5,583.
- % of AIME greater than $5,583.
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Is Social Security based on the last 5 years of work?
A: Your Social Security payment is based on your best 35 years of work. And, whether we like it or not, if you don't have 35 years of work, the Social Security Administration (SSA) still uses 35 years and posts zeros for the missing years, says Andy Landis, author of Social Security: The Inside Story, 2016 Edition.
How much Social Security will I get if I make 20000 a year?
If you earned $20,000 for half a career, then your average monthly earnings will be $833. In this case, your Social Security payment will be a full 90% of that amount, or almost $750 per month, if you retire at full retirement age.
How much Social Security will I get if I make 60000 a year?
That adds up to $2,096.48 as a monthly benefit if you retire at full retirement age. Put another way, Social Security will replace about 42% of your past $60,000 salary. That's a lot better than the roughly 26% figure for those making $120,000 per year.
How much Social Security will I get if I make $100000 a year?
Based on our calculation of a $2,790 Social Security benefit, this means that someone who averages a $100,000 salary throughout their career can expect Social Security to provide $33,480 in annual income if they claim at full retirement age.