Understanding the Average Social Security Benefit for Those Aged 65
How Social Security benefits are calculated at age 65
Social Security benefits are calculated the same way for any age -- up to a point, anyway. SSA follows three key steps.
Step 1: Average Indexed Monthly Earnings (AIME)
- SSA calculates a worker's AIME based on up to 35 years of earnings.
Step 2: Primary Insurance Amount (PIA)
- An individual's PIA is determined using their AIME.
Step 3: Impact of Claiming Age
- Benefits vary based on when you claim Social Security in relation to your Full Retirement Age (FRA).
If you claim benefits at 65, your monthly benefit will be 87.78% of your PIA.
The average Social Security benefit for 65-year-olds
In December 2022, the average monthly benefit stood at $1,504.98 for those aged 65, with variations between men and women due to different earnings.
Pros and cons of claiming Social Security at 65
Considerations for claiming Social Security at 65 include eligibility for Medicare, but also weigh in on the early retirement penalty and the financial impacts of waiting. The decision to claim at 65 involves navigating the balance between retirement age and benefit amounts.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.