Your payment is based on your highest 35 years of earnings and the age you start collecting
Social Security calculates your monthly payment by looking at your work history — specifically, your earnings in the 35 years when you made the most money. The Social Security Administration (SSA) adjusts those older earnings to account for wage growth over time, adds them up, and divides by the number of months you worked. That gives you your Primary Insurance Amount (PIA), which is the payment you would receive at your full retirement age.
The age you choose to start collecting then changes that amount. If you start at 62, your payment is smaller. If you wait until 70, it is larger. The SSA publishes a detailed earnings record for you — the same one they use to calculate your payment — and you can see it anytime by creating an account at ssa.gov.
Key Takeaways
- Your payment is based on your 35 highest-earning years; if you worked fewer than 35 years, zeros are counted for the missing years.
- Your full retirement age (when you get your full payment amount) is between 66 and 67, depending on your birth year.
- Starting at 62 reduces your payment by about 30 percent; waiting until 70 increases it by about 24 percent per year of delay.
- You can view your own earnings record and an estimate of your payment on your Social Security account at ssa.gov.
How the 35-year earnings history works
Social Security counts your earnings from age 21 onward, but only uses your 35 highest-earning years in the calculation. If you worked for 40 years, the five lowest-earning years are dropped. If you worked for only 30 years, the calculation includes five years of zero earnings, which lowers your payment.
The SSA adjusts older earnings upward to reflect wage growth. Your 1990 earnings are not compared dollar-for-dollar to your 2020 earnings; instead, the older amounts are multiplied by a wage index so they reflect what those wages would be worth in today's economy. This means a year you earned $20,000 in 1990 might be counted as $50,000 in the calculation, depending on how much wages have grown since then.
Self-employed people and people who worked under the table do not have earnings counted unless they reported them to the SSA through tax returns or self-employment tax payments. Only reported earnings count toward your record.
Your full retirement age and how it affects your payment
Your full retirement age is the age at which you receive your full Primary Insurance Amount. This age is not 65 for everyone. It depends on your birth year:
| Born | Full Retirement Age |
|---|---|
| 1943–1954 | 66 |
| 1955 | 66 and 2 months |
| 1956 | 66 and 4 months |
| 1957 | 66 and 6 months |
| 1958 | 66 and 8 months |
| 1959 | 66 and 10 months |
| 1960 and later | 67 |
You can start collecting at 62, but your payment will be permanently reduced. You can also wait past your full retirement age, up to age 70, and your payment will increase for each month you delay. The reduction or increase is permanent — it applies to every payment you receive for the rest of your life.
How starting age changes your monthly payment
The relationship between your starting age and your payment amount is fixed by law. If your full retirement age is 67 and your full payment would be $1,500 per month, starting at 62 would give you roughly $1,050 per month (about 70 percent of your full amount). Waiting until 70 would give you roughly $1,860 per month (about 124 percent of your full amount).
These percentages do not change year to year. The SSA publishes the exact reduction and increase factors in its rules, and they explore the same way to everyone born in the same year. The choice of when to start is yours — there is no "best" age that works for everyone, because it depends on how long you live, whether you need the money now, and your health.
If you are still working when you start collecting before your full retirement age, your payment may be temporarily reduced if your earnings exceed a certain amount. Once you reach your full retirement age, there is no earnings limit, and your payment goes back to its full amount.
How to find your own earnings record and payment estimate
You do not have to wait until you are ready to start collecting to see what your payment might be. The SSA lets you create a free account at ssa.gov and view your earnings record — the same record they use to calculate your payment. You can see every year of reported earnings and spot any errors or missing years.
The same account shows you an estimate of your payment at different starting ages. This estimate is based on the assumption that your earnings stay the same until you start collecting. If you plan to work more years or earn more, the estimate will be higher when you check it again later.
If you find an error in your earnings record — a year where you earned money but it is not showing, or an amount that is wrong — you can report it to the SSA. You will need tax records or W-2 forms to prove the correct amount. Errors are more common than you might think, especially for people who changed jobs, were self-employed, or worked under different names.
What happens if you did not work 35 years
If you worked fewer than 35 years, the SSA counts the missing years as zero. This lowers your average and your payment. For example, if you worked 30 years, five years of zero earnings are included in the calculation, which reduces your payment by roughly 12 to 15 percent compared to someone with the same earnings spread over 35 years.
You can improve your payment by continuing to work. Each year you work and earn money replaces a zero year (or a low-earning year) in the calculation. Even a few more years of work can noticeably increase your payment, especially if those years have higher earnings than your lowest years on record.
Government workers who did not pay into Social Security during their career may have a different calculation applied to their payment. This is called the Windfall Elimination Provision (WEP). If this applies to you, the SSA will explain it in your earnings record.
How cost-of-living adjustments affect your payment over time
Once you start collecting, your payment does not stay the same forever. Each year, the SSA increases payments by a cost-of-living adjustment (COLA) to help keep up with inflation. This increase is the same percentage for everyone and is based on the Consumer Price Index.
The COLA is announced in October each year and takes effect in January. Some years the increase is small; some years it is larger. In years when inflation is very low, there may be no increase at all. The COLA applies to all people collecting Social Security — retirees, disabled workers, and survivors.
Frequently Asked Questions
Can I see my Social Security payment estimate before I turn 62?
Yes. Create an account at ssa.gov and you can view your earnings record and see estimates of your payment at different starting ages. The estimate assumes your earnings stay the same until you start collecting, so it may change if you work more years or earn more money.
What if I have a gap in my work history?
Gaps are counted as zero-earning years in your calculation. If you worked only 30 years, five years of zeros lower your payment. Working more years can replace those zeros and increase your payment, especially if the new years have higher earnings than your lowest years on record.
Does my spouse's earnings affect my payment amount?
No. Your payment is based only on your own earnings record. Your spouse may be able to receive a payment based on your record, but that does not change the amount you receive. Spousal payments are calculated separately.
What if I made a mistake on my tax return and underreported my earnings?
Contact the SSA with corrected tax records or W-2 forms showing the correct amount. The SSA can update your earnings record if you provide proof. It is worth doing this even years later, because correcting your record can increase your payment.
Does working longer always increase my payment?
Usually yes, if you earn more in those years than your lowest-earning years on record. But if you work at a much lower wage than your highest 35 years, the new year might not replace a higher-earning year and could have little effect on your payment.