How Much Would I Get If I Stop Working Now?

Sep 12 2016 - 10:45am

I make $106,000 and plan to retire in 2018 at age 70. SS tells me that I will make about $2500 a month if I continue at that salary. How much would I get in 2018 if I stop working now? Thanks. Von

Hi Von,

The answer to your question depends on how much higher your current earnings are, compared to the lowest earnings presently being used to compute your benefit amount. Social Security retirement benefits are based on an average of a person's best 35 years of inflation adjusted earnings. If you earn $106,000 for the next 2 years, those years will certainly be among your highest 35 years, and will raise your benefit amount as a result. If you have no earnings for the next 2 years, your benefit amount will be based on the best 35 years to date.

So, I can't answer your question precisely. I can tell you that 2 years of even very high earnings usually only has a relatively small impact on a 35 year average. However, if you have fewer than 35 years of Social Security covered earnings, and zero earnings years are currently being used in calculating your benefits as a result, replacing 2 zero earnings years with 2 years of $106,000 of earnings could make a difference of as much as roughly $100 in your monthly benefit rate. On the other hand, if you've already had 35 years of covered earnings, the difference would smaller.

Best, Jerry