According to the Social Security Administration’s schedule, retirees born between the 11th and 20th of a month will be eligible to receive a Social Security retirement payment for June. The payment amount can reach up to $4,555. These monthly payments are distributed on the second, third, and fourth Wednesdays of each month.
On June 28, the fourth and final Wednesday of the month, the last round of payments will be issued to individuals born after the 21st. The initial set of Social Security payments was sent on June 14 to recipients born between the first and 10th of a month. While the payments are distributed in three separate waves, each recipient receives a single monthly check.
Maximum Social Security payment amount
The maximum payment amount varies based on the individual’s retirement age. Those who retire at 62 can receive monthly installments of up to $2,572, while those retiring at 67 can receive a maximum benefit of $3,627. Individuals who choose to delay retirement until 70 receive the highest payment of up to $4,555 per month, as per the SSA’s guidelines.
Social Security beneficiaries also receive an annual cost-of-living adjustment, determined by the previous year’s consumer price index for urban wage earners and clerical workers. However, the increase projected for next year is significantly lower at just 2.7%, compared to the substantial 8.7% increase observed in 2023.
If Congress fails to reach a funding resolution for the program, Social Security recipients may face a potential reduction in their future payments. Congressional discussions regarding the future of Social Security have been ongoing for years, and experts have cautioned that the program could face insolvency within a decade if no action is taken. The program’s trust funds are projected to be depleted by 2033.
Currently, the standard retirement age in the United States is 67. However, House Republicans have recently proposed a gradual increase in the full retirement age to 69 by 2033. Nevertheless, individuals planning to retire soon still have the option to retire early at 62 or delay retirement until as late as 70.
How Social Security payments are calculated: This is how you get your monthly payments
The main factor in determining Social Security payments is an individual’s earnings history: they will study it and start from there. The SSA keeps a record of an individual’s earnings throughout their working years, considering the highest 35 years of earnings. Higher lifetime earnings generally result in higher Social Security payments.
The age at which an individual decides to retire also affects their Social Security payments: the older you retire, the most you’ll get every month. The age of retirement is significant because it determines whether the payments received will be reduced or increased compared to the full retirement age.
Regarding the last statement, the full retirement age is the age at which individuals can receive their full Social Security retirement benefits. It is determined by the year of birth and is gradually increasing. Understanding the full retirement age is crucial to make informed decisions regarding when to start claiming benefits.
The Primary Insurance Amount (PIA) is the base amount used to calculate an individual’s Social Security payments. The PIA is determined by considering the average indexed monthly earnings (AIME) and applying a formula that incorporates bend points. The Average Indexed Monthly Earnings, also called AIME, is calculated by indexing an individual’s earnings to account for wage growth and taking the average of the highest 35 years of indexed earnings. It provides a measure of the individual’s relative earnings level over their working years.
The PIA formula uses bend points, which are specific dollar amounts that determine how much of an individual’s AIME is factored into their PIA. At this point, this becomes complicated to explain, but you don’t necessarily need to decode this. Finally, the Social Security payments are subject to annual cost-of-living adjustments (COLA) to account for inflation. COLA ensures that benefit amounts keep pace with rising living expenses, helping retirees maintain their purchasing power.
They will also consider cases like spousal benefits, survivors’ benefits, and divorced spouse benefits, in particular situations.