Social Security benefits play a crucial role for many Americans, often serving as their primary source of retirement income. To maximize these benefits, understanding their calculation is key. The benefits are influenced by the number of years you have worked, specifically your 35 highest earning years, and your earnings during those years. If there are gaps in your work history, especially with low or no earnings, this can significantly reduce your monthly benefits. Therefore, it's essential to ensure you have enough qualifying years to earn the maximum benefit possible.
If you're gearing up to claim benefits, take a trip down memory lane and count the number of years during which you brought home a paycheck.
Social Security, on the other hand, is set up to pay your monthly benefits for life. So it's not a bad thing to score as large a benefit as possible.
But if your goal is to get more out of Social Security, then it's important to know how benefits are calculated.
The formula used to calculate your Social Security benefits takes your 35 highest-paid years of earnings into account.
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