Retirement planning

What does a typical Social Security check look like?

Many different recipients can receive a monthly benefit check from Social Security. According to the Social Security Administration, the average check as of June 2022 was $1,542.22; however, the amount might vary greatly depending on the type of recipient. In actuality, retirees frequently earn more money than the general populace.

The average Social Security check by recipient, the potential growth of your check over time, and the maximum benefit are shown here.

The typical Social Security benefit by kind

While the majority of people believe that Social Security is only for seniors, it actually benefits a wide range of people, including the disabled, the spouses and minor children of retirees, as well as the spouses and minor children of workers who have passed away. Each group receives a significantly different amount.

In actuality, the average retired worker gets $1,669.44 per month, which is nearly 8% more than what Social Security pays to all of its beneficiaries. As of June 2022, the data are broken down as follows by recipient.

Type of beneficiaryPercent of total payoutsAverage monthly benefit
All recipients100%$1,542.22
Retirement benefits77.2%$1,623.10
   Retired workers73.0%$1,669.44
Survivor benefits8.9%$1,328.21
   Nondisabled widow(er)s5.4%$1,562.09
Disability insurance13.8%$1,228.87
   Disabled workers11.9%$1,361.88

The three main recipient categories—retirement benefits, survivor benefits, and disability benefits—are highlighted in bold in the table. These categories’ sums equal one hundred percent. Each sub-category below identifies the top beneficiary of Social Security assistance.

As you can see, retirement payments account for the vast majority of Social Security (77.2%) and are mostly paid to retired workers. Spouses and young children of retired workers receive the balance in this group; they typically receive a cheque for roughly $800 per month.

8.9% of Social Security benefits are survivors benefits. Non-disabled widows or widowers are the largest subgroup, with average monthly payments of $1,562.09.

Disability insurance accounts for roughly 13.8 percent of total Social Security benefits, with handicapped workers receiving the highest average payout of $1,361.88.

Additionally, those advantages might not be totally taxable. On their benefit check, some Social Security recipients can legitimately dodge taxes.

Benefits increase as the cost of living changes.

Although the Social Security income is a wonderful sum of money, if it remained the same for the following 30 years, inflation would reduce its purchasing value. Because of this, Social Security gradually raises benefit payments through a cost of living adjustment, or COLA.

The Consumer Price Index, which gauges how much inflation has impacted consumer prices for goods and services, is the basis for this increase.

Typically, the COLA is only slightly increased, but due to greater inflation in 2022, the increase will be 5.9%. The degree of adjustments that grantees have gotten during the last ten years is shown below.

YearCOLA increaseYearCOLA increase

So, if you started with a $1,000 benefit in 2012, what would your overall check be? In 2022, you would receive $1,203.38.

How much in monthly Social Security benefits is the maximum?

The total amount of Social Security benefits you could receive varies depending on your earnings throughout your working years, when you start receiving benefits, and your COLA increase. Naturally, if the COLA shows an increase, your benefits will eventually rise.

By retirement age, the maximum beginning monthly compensation for 2022 is:

  • At age 62: $2,364
  • At age 65: $2,993
  • At age 66: $3,240
  • At age 70: $4,194

These numbers presuppose that a worker has been continuously earning at the highest tax bracket since turning 22. The maximum taxable income for 2022 is $147,000, a figure that typically increases every year. Here is a guide to estimating your benefit payment.

Your benefit is based on your earnings, up to a certain annual amount. Taking advantage of your benefit later in life might potentially significantly improve it. When a worker reaches what is known as full retirement age, which can range from 65 to 67 depending on when they were born, they are eligible to start receiving benefits early, at age 62, if they have contributed ten years of employment.

Your check will be smaller if you take advantage of early retirement benefits than it would otherwise be at full retirement or even later. You can receive even more money each month if you wait until you are 70 to file for benefits.

In reality, the most contentious aspect of the Social Security system is arguably when to start claiming benefits.

You must pay Social Security taxes of 6.2 percent of your salary, up to the maximum tax income, in order to be eligible for these benefits. If you work for yourself, you are responsible for paying the additional 6.2 percent of your earnings that your employer contributes to the fund.

To sum up

It is crucial that Social Security be a part of your entire retirement plan rather than your sole source of income because the average Social Security payment was never intended to replace a retired worker’s full income. It’s critical to start saving and investing now, while time is still on your side, if you have years before retirement.

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