Even if you’ve saved decently for retirement, there’s a good chance Social Security will play an important role in your future finances. For this reason, it’s important to try to snag as large a monthly check as possible.
The maximum monthly benefit Social Security will pay in 2025 is $5,108. But most retirees collect a much smaller benefit than that. In fact, the average monthly benefit for retired workers was about $1,979 as of January.
The reason most retirees can’t collect the maximum Social Security benefit is that their earnings aren’t high enough to snag it. To get that payday, your earnings need to meet or exceed the Social Security wage cap for 35 years. And while that cap is adjusted annually, it currently sits at $176,100.
But don’t worry — if you don’t earn enough to collect Social Security’s maximum monthly benefit, there are other steps you can take to ensure that you have enough money for your retirement, like these.
In order to snag Social Security’s maximum monthly benefit, you need a 35-year work history with very high earnings, and you need to sign up at age 70.
You may not be able to control the first part — meaning if you’re in a lower-paying industry where the average annual wage is $75,000, you’re probably not going to hit or exceed the wage cap. But you can control the second part by holding off on Social Security past full retirement age.
Of course, that’s not a decision you can make on the fly. You may, for example, need to work on boosting your job skills and keeping certifications up to date to remain employed through your 70th birthday. But even if you’re looking at a much lower monthly benefit than $5,108, if you file at 70, you’re guaranteed a significant boost.
The right investments in your portfolio can serve as nice supplemental retirement income. So it’s important to choose those strategically.
One good option is to load up on dividend stocks. Another is to add municipal bonds to your portfolio, since they are known to provide predictable income. And as a bonus, municipal bond interest is always federally tax-exempt.
Working can be a nice way to boost your retirement income. And you should know that you’re allowed to collect a paycheck from a job even if you’re getting Social Security (however, if you have not yet reached full retirement age, you could risk having some of your benefits withheld if you earn too much).
