Dear Penny: How Do I Know How Much Social Security I Should be Getting?

Dear Curious,

To determine whether the Social Security check you receive is for the correct amount, you should know the basics about how Social Security works and where to find information about your account.

A few facts to give context to your check:

• Your benefit amount depends on three factors: how long you’ve worked, your earnings from work and your age when you start claiming benefits.
• You earn Social Security credits based on your earnings each year, and those determine your eligibility for benefits. As a rule of thumb, you’re eligible to receive benefits as long as you’ve worked full-time for at least 10 years in your life.
• Your monthly benefit amount is based on an average of your 35 highest-earning years of work, including $0 years if you worked less than 35 years.
• You can claim benefits as early as 62 years old, but you’re penalized with a reduction in benefits for claiming before full retirement age, which is 67 for anyone born in 1960 or later, and 66 for anyone born between 1943 and 1959.
• The latest you can start claiming your benefit is age 70. Between full retirement age and 70, you’ll be rewarded with an additional 8% benefit for each year you wait to claim.
• Each year, Social Security amounts are increased for a cost of living adjustment (COLA) to account for price inflation. The annual COLA is announced in October the previous year.
• On average, the Social Security Administration says, Social Security benefits will replace about 40% of your pre-retirement earnings. But there’s a maximum benefit, and the monthly payment for the highest earners maxes out at less than $5,000 for 2024.

Use these options to get an estimate of future Social Security benefits or manage your existing benefits:

• Create a my Social Security account at SSA.gov/myaccount. (You’ll need an email address and your Social Security number.)
• Enter your information and earnings history manually through the Social Security Administration’s Online Benefits Calculator.
• Contact the Social Security Administration at 800-772-1213 (TTY 800-325-0778).

Dana Miranda is a Certified Educator in Personal Finance®, author, speaker and personal finance journalist. She writes Healthy Rich, a newsletter about how capitalism impacts the ways we think, teach and talk about money.