While most people can count on Social Security money in retirement, the amount is up in the air until you actually file. Many factors go into determining your Social Security benefits, including how much you’ve earned over the years you’ve worked and your age when you apply.
While your state doesn’t affect the size of your checks (unless it takes away a portion of your benefit in taxes), it can still be interesting to see how your checks stack up against others. That’s what the numbers say.
10 states with the highest average Social Security payments
The following 10 states had the highest average Social Security payments as of December 2020, the most recent month for which data is available:
- New Jersey
- New Hampshire
It’s hard to say why residents of these states are entitled to higher paychecks than residents of other states. Median income in these states may be a factor because Social Security checks are based on a person’s earnings over their years of work. But that’s not the only thing that works in your favor.
How to increase your Social Security checks no matter where you live
There are a few things anyone can do to boost them Social Security Assistance, regardless of where they live. Working for at least 35 years is important because the government calculates your Social Security benefits based on your average monthly income over your 35 highest-earning years, adjusted for inflation. Working for even more than 35 years can increase your paycheck even more, especially if you’re earning more than you did when you first started working.
Working to increase your income today can also help you reap the benefits later. You can do this by securing a promotion, finding a higher-paying job elsewhere, or starting a successful business of your own. The only people it won’t help are those who already earned $147,000 or more in 2022. That’s the maximum you’ll pay in Social Security taxes this year, so any excess won’t help you get the benefit.
Choosing the right claim age is also important. You have to wait until your full retirement age (FRA) to get the benefits you’ve earned based on your work history. It’s somewhere between 66 and 67, depending on your year of birth.
You can qualify as early as age 62, but that will reduce your benefits to 25% if your FRA is 66, or 30% if your FRA is 67. You can also delay paying until you reach the maximum benefit at 70, and your checks will grow to 24% if your FRA is 67 or 32% if your FRA is 66.
If you don’t need Social Security right away, it’s best to delay your benefits if you think you’ll live into your 80s or beyond. In this way, most people end up benefiting more than they would have if they had filed earlier. But if you have a short life expectancy, you’d better file your claim right away. You may also need to register early if you need financial help to pay your bills.
Moving, even to one of the states above, will do nothing to increase your Social Security benefits. But in some cases, moving can help give your Social Security dollars a little boost.
If you live in a the state that taxes Social Security benefits and you switch to one that doesn’t, it can help you keep more of your paychecks each year. Likewise, if you live in an area with a high cost of living and move somewhere with a lower cost of living, your Social Security checks may be slightly larger than in your current home.
If you want a clear idea of how much you will get from the program, create a my social security account. Here you can view the government’s statement of your income and estimate your benefits at different ages using the calculator. You can also see how changes in your income can affect the size of your checks.
Use this information to determine when you want to sign up for benefits and how much you expect to receive from the program. Build it into yours retirement plan and review your claims strategy annually to make sure it’s still working for you.
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