The age at which you intend to retire will have a heavy impact in the amount the Social Security Administration (SSA) allocates to you for the rest of your life: this is crucial because claiming your payments at 62 is not the same as claiming your payments at 65 or 70. It is also determined by factors such as your income throughout your working life and your contribution history.
The Social Security system is a federal program that provides monthly benefits to retired workers, people with disabilities, and their families. Benefit amounts are based on average indexed monthly earnings (AIME) during an individual’s 35 highest-earning years. These earnings are adjusted for inflation and used to calculate the primary insurance amount (PIA), which is the basis for determining monthly benefits.
Maximum benefits according to retirement age in 2025
A beneficiary can begin receiving benefits as early as age 62, but the amount is reduced by thousands of dollars compared to waiting until age 70:
- At age 62 (minimum retirement age): $2,831 per month.
- At age 67 (full retirement age for those born in 1960 or later): $4,018 per month.
- At age 70 (maximum age to increase benefits): $5,108 per month.
Two considerations that can increase your monthly check:
After age 70, the monthly amount stops increasing because work credits no longer accumulate in your retirement fund. On the other hand, retiring at age 62 means a 30% loss compared to age 70.
Here’s the trick many people don’t know: if you earn more than 35 years of contributions, the new years of higher salaries automatically replace the old years when you earned less. It’s like updating your salary record upwards.
Retirement payments increase each year to cope with inflation
In 2025, only the first $176,100 of your annual income is considered when calculating your Social Security pension. If you earn more than that—for example, $200,000 a year—the last $23,900 is not considered when determining your benefits. This means that even if you have a high salary, a portion of your income will not influence the amount you receive in retirement.
Now, here’s the Cost-of-Living Adjustments (COLA) thing: Social Security benefits are adjusted annually to reflect changes in the cost of living. In 2025, a 2.5% increase was implemented, bringing the average monthly benefit for all retired workers to $1,976.
Do you see how every detail of your career ultimately influences your outcome? The primary goal is to strategically plan these factors, especially if you’re aiming for the maximum retirement benefit, or the subsequent pension.
