How Much Will You Receive from Social Security? How Is It Calculated? -

How Much Will You Receive from Social Security? How Is It Calculated?

You need a total of 40 credits to qualify for Social Security retirement benefits. For each $1,200 you make, you earn one credit. Each year, you can earn up to four credits. Once you have earned $4,800 you have earned your four credits for the year and do not accumulate any more.

Your yearly earnings over your working lifetime are used to calculate your benefit amount. The Social Security Administration takes your 35 highest earning years, converts them to today’s dollars, puts them into a formula, and determines your benefit.

You can obtain a list of your yearly earnings over your working lifetime by going to, clicking on “My Social Security,” and creating a personal account. Here you can view and print your individual statement.

Why is this important? You can use this information to help you decide when to begin collecting benefits. For instance, I worked through college and chiropractic school and earned four credits each of those years, but at a very low income. If I continue to work at my current salary, I can replace those low-income years with higher income years and increase my monthly benefit amount for the rest of my life.

To see the difference in your benefit using different parameters, you can use the benefit estimatorprovided by Social Security. You can determine what your benefit would be now and what it will be if you continue working. You can see what it will be if you work at your current salary or if you work at a different rate. This can help you make an informed choice as to what age is best for you to retire and also if working longer will make a significant difference in your Monthly payments.

The choices you make will affect your income for the rest of your life. Think about it carefully. Feel free to ask any questions you may have. My goal is to make this transition easier for as many people as possible. Please share this information with those you feel would benefit.


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