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How Much Social Security Will I Get at Age 65?
The Social Security Administration (SSA) operates several different benefit programs designed to serve different groups of people. The most used program is the Social Security Retirement program which everyone who worked a sufficient number of years and paid payroll taxes is eligible to receive benefits.
Everyone who is receiving Social Security Disability (SSD) benefits will see that their monthly payment will switch from Social Security Disability benefits to Social Security Retirement benefits when they reach their full retirement age.
MJ Ellis Disability Law devotes our entire law practice to helping disabled people in northern New Jersey and the surrounding area get the disability benefits they deserve and for which they are eligible. Many people don’t know which benefits they qualify for and are missing out on valuable benefits that could ease their daily struggles in life. If you need help with any aspect of disability benefits, let MJ Ellis Disability Law help you. Call us at (973) 940-8635 anytime, or email firstname.lastname@example.org.
Getting Social Security Retirement Benefits at Full Retirement Age (FRA)
Before 1983, all workers reached retirement age on their 65th birthday. Congress believed the Social Security Retirement Trust Fund would eventually become insolvent unless they adjusted the retirement age of the current and future workforce. The law they enacted gradually raised the “Full Retirement Age” from 65 to 67 over the course of 22 years.
Workers who were born before 1937 continued to be eligible for full retirement benefits at 65. But those born between 1938 and 1942 would see a gradual increase of 2 months for each successive birth year. (1938, 65 and 2 months; 1939, 65 and 4 months; 1940, 65 and 6 months, etc.). Workers who were born between 1943 and 1954 would all have 66 as their retirement age. Beginning with people born in 1955, the graduated retirement age increase begins again; 1955, 66 and 2 months; 1956, 66 and 4 months; 1957, 66 and 6 months, etc. Finally, everyone born in 1960 or later will reach their full retirement age at 67.
How Much Will Your Social Security Retirement Benefit Payment Be?
When you reach your full retirement age (FRA), your monthly Social Security retirement benefit will be determined using a process based on the income you earned in your 35 highest earning years of work. This is the exact same process and formula used to determine the benefit amount for people receiving Social Security Disability (SSD) benefits. If you are receiving SSD benefits, when you reach your full retirement age, your benefits payments will remain the same but will come from a different department of the SSA.
The Formula Used to Determine SSD and Retirement Benefits:
To find the amount each worker will receive in their full Social Security Retirement benefit, the SSA looks at the 35 years in which you earned your highest income. Those annual income figures are then indexed to relate them to the national average income in those years. Then, the government adds those 35 indexed amounts together, divides them by 35 (to get average annual earnings), and then divides them by 12 to get the key figure, the Average Indexed Monthly Earnings (AIME).
Your Average Indexed Monthly Earnings (AIME) is the base figure that Social Security uses to apply the formula which will determine your retirement benefit amount (or your SSD benefit amount).
- Add 90 % of the first $1,024 of the AIME, plus
- 32 % of the amount between $1,024 and $6,172, plus
- 15 % of any amount above $6,172
- Round down that figure to the next lowest ten cents ($0.10) to finally arrive at what the SSD administrators call your Primary Insurance Amount (PIA).
- The PIA is the amount your monthly Social Security Disability benefit payment will be.
To illustrate how the formula works with hypothetical worker’s figures, let’s assume that our hypothetical retiree is named Pat who has an Average Indexed Monthly Income (AIME) of $5,833.
- Add 90 % of the first $1,024 of $5,833 = $921.60 plus
- 32 % of the amount between $1,024 and $6,172 = $5,148 x .32 = $1,647.36, plus
- 15 % of any amount above $6,172 = $ 0.00
- $921.60 + $1,647.36 + $0.00 = $2,568.96 then
- Round down that figure to the next lowest ten cents ($0.10) = $2,568.90 to finally arrive at what the SSD administrators call your Primary Insurance Amount (PIA).
- The PIA is the amount your monthly Social Security Disability benefit payment will be. In this case, Pat’s monthly Social Security Retirement benefit is $2,568.90.
New Jersey’s Disability Lawyer is MJ Ellis Disability Law
We hope you’ve learned more about how your Social Security Retirement benefit amount and your Social Security Disability benefit amount are determined by your past income. But you probably still have other questions, and we are here to help you get answers and to get you the benefits you are entitled to.