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Who can receive the maximum social security of $3,895 monthly?

Each year the maximum amount distributed in Social Security benefits increases. How high does one's annual income need to be to claim the maximum benefit?

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Who can receive the maximum social security of $3,895 monthly?
Kevin Dietsch AFP

Social security benefits for retirees are calculated by taking into account a few factors, primarily: 

  • Annual income for the thirty-five years a worker earned the most
  • Retirement age. 

For disabled people claiming benefits, the amount is based on a more complicated formula that includes, medical information, work history and income, age, and more.

In 2020, around 74.2 percent of those receiving social security benefits were retirees. Those with disabilities comprised a little over 13 percent of beneficiaries, and families of deceased beneficiaries form the remaining recipients.

The average benefit amount was $1,544 for retirees and $1,277 for those with disabilities.

For retirees, the maximum benefit amount depends on the year one retires. Those who chose to retire before sixty-five are penalized with lower benefits. The highest benefits are given to those who retire at the age of seventy, $3,895; followed by those who retire at sixty-five, $3,113
. Those who opt to retire before the full retirement age, at sixty-two, can receive a maximum benefit of $2,324
 a month.

Who receives the maximum benefit?

Benefit amounts are determined by looking at the thirty-five years of work where the retiree earned the highest income. Years earlier in one's career are "adjusted or “indexed” to account for changes in average wages since the year the earnings were received.

To cap the benefit amount, one can only report an annual income up to a certain point. Any additional income for a given year after that cap is not included in the benefit calculation.

  • 1952, 1953, 1954: $3,600 -- 1955, 1956, 1957, 1958: $4,20 -- 1959: $4,200
  • 1960, 1961, 1962, 1963, 1963, 1965: $4,200 -- 1966, 1967: $6,600 -- 1968, 1969: $7,800
  • 1970, 1971:  $7,800 -- 1972: $9,000 -- 1973: $10,800 -- 1974: $13,200
  • 1975: $14,100 -- 1976: $15,300 -- 1977: $16,500 -- 1978: $17,700 -- 1979: $22,900
  • 1980: $25,900 -- 1981: $29,700
  • 1982: $32,400 -- 1983: $35,700 -- 1984: $37,800 -- 1985: $39,600 -- 1986: $42,000 -- 1987: $43,800 -- 1988: $45,000 -- 1989: $48,000
  • 1990: $51,300 -- 1991: $53,400 -- 1992: $55,500 -- 1993: $57,600 -- 1994: $60,600 -- 1995: $61,200 -- 1996: $62,700 -- 1997: $65,400 -- 1998: $68,400 -- 1999: $72,600
  • 2000: $76,200 -- 2001: $80,400 -- 2002: $84,900 -- 2003: $87,000 -- 2004: $87,900 -- 2005: $90,000 -- 2006: $94,200 -- 2007: $97,500 -- 2008 $102,000 -- 2009: $106,800
  • 2010: $106,800 -- 2011: $106,800 -- 2012: $110,100 -- 2013: $113,700 -- 2014: $117,000 -- 2015, 2016: $118,500: -- 2017: $127,200 -- 2018: $128,400 -- 2019:$132,900 -- 2020: $137,700
  • 2021: $142,800

In 2020, only around eighteen percent of the population made over $150,000, meaning that there are not many people who are able to claim the maximum benefit.

These maximums are much higher than the average salary seen by the vast majority of workers in the United States. In 2019, the US Census Bureau reported that the real median earnings for men were $57,456, and for women, the median was more than $10,000 less at $47,299.

 How many people in the United States have a private pension or retirement fund?

In addition to social security benefits, millions of retirees also rely on pensions or private funds liek a ROTH IRA. These funds provide additional income, which helps some as social security benefits are often described as "modest."

In 2020, almost half of workers -- 48 percent -- had access to a pension or private fund. This is concerning as the Social Security Administration estimates that "By 2035, the number of Americans 65 and older will increase from approximately 56 million today to over 78 million."