Which Years Are Used To Calculate Retirement Benefit Rates?

Nov 24 2017 - 12:11pm

If one stops working at 62 and plans to draw social security at 70, I understand that Social Security calculates monthly paid by SSA for the last 35 years worked/income. If one does not work from 62-70 (8 years) their income would be zero. Are these years calculated/included OR only the last 35 years worked with income? If the person has monthly pension (military) during the 8 years, is this included in the 35-year calculation with social security even though the person did not work during the 8 years? Thank you!


Social Security doesn't necessary use the LAST 35 years of a person's work to calculate their retirement benefit rate. Instead, they use an average of the person's highest 35 years of wage-indexed earnings, regardless of when those earnings occurred (https://www.ssa.gov/pubs/EN-05-10070.pdf). Therefore, if a person has no earnings from age 62 to age 70, Social Security would simply not use those years in the person's benefit calculation, assuming that they had at least 35 other years in which they had covered earnings.

Military pensions are not subject to Social Security taxes, and would not be used to calculate a person's Social Security benefit amount.

Best, Jerry