Nearly all eligible seniors claim Social Security benefits, and President Joe Biden is no exception. Since he has publicly shared some of his recent tax returns, we know exactly how much the president receives from the program, and the answer may surprise you. Here’s a closer look at Biden’s advantage and how it compares to that of the average American.
A bigger advantage for Biden
The average Social Security benefit for 2019 — the most recent year for which Biden’s tax returns are available — was about $1,563 per month. That works out to about $18,756 per year.
In 2019, President Biden received $35,069 from the program, or about $2,922 per month. That’s more than $16,000 more than the average worker received during the year.
But it’s still a long way from the maximum social security benefit available. Top-earning seniors who waited until age 70 before claiming could have brought in $3,770 per month in 2019, which equates to $45,240 per year.
It’s worth noting that these numbers are a bit outdated. The average worker’s Social Security benefits have now risen to about $1,559 per month, thanks to annual cost-of-living adjustments (COLAs). These increase everyone’s Social Security benefits slightly to curb inflation.
COLAs have also increased the maximum Social Security benefit to $3,895 per month in 2021. Biden’s benefit has also been increased. Taking into account Social Security’s 1.6% COLA in 2020 and the 1.3% COLA in 2021, his monthly benefit in 2021 would be about $3,008 per month.
How to make your Social Security benefits even better
Beating Biden’s Social Security benefits is a tall order, but it may be possible for some employees who take the following steps.
First, make sure you work long enough. Your Social Security benefit is based on your average monthly income over your 35 highest-earning years. If you work fewer years, the government will include a few zero-income years in your calculation, so that your monthly benefit will be lower.
Working longer than 35 years is usually a good idea, because people often earn more later in their careers than when they were younger. These later, higher-earning years gradually replace their earlier, lower-earning years in their benefit calculation, resulting in greater checks.
Anything you can do to increase your income during your working years will also help increase your Social Security benefits, as long as you earn less than $142,800 by 2021. That’s the maximum income subject to Social Security tax, so anything above this amount won’t increase your benefit. This limit will increase to $147,000 in 2022.
Most importantly, delaying benefits can also increase your checks. You’ll be eligible for Social Security at age 62, but you’ll have to wait until your full retirement age (FRA) — between 66 and 67 — to get the full amount you’re entitled to based on your work history. You can also continue to defer distributions past your FRA and your checks will grow a little each month until you reach your maximum payout at 70.
However, waiting to claim is not always a good idea. If you have serious health problems or if you need Social Security to pay your bills, signing up earlier is the better choice.
Track your progress
To have a concrete idea of how big your Social Security checks will be, create a My Social Security account. There you’ll find a breakdown of all the income you’ve paid Social Security taxes on over the years, as well as a benefit calculator that can tell you how much you’ll receive per month at different starting ages. If you expect your income to change over the years, you can also see how this will affect your checks.
Once you have an idea of how much money you will receive from the program, subtract it from your total estimated retirement costs to find out what you need to save for yourself. Re-do these calculations every two years to make sure you’re still on track for your goals. It doesn’t take long and can help you avoid unpleasant financial shocks in retirement.