The first step in planning for retirement is understanding how much money you may receive from Social Security in the future. Social Security provides income after retirement and can also help people through disability and survivor benefits. Knowing your future Social Security benefits can help you plan your savings and investments more effectively. It gives you a better idea of how much income you may have after retirement.
Social Security calculates your benefits based on your earnings and work history. To qualify for benefits, you must earn Social Security credits. The number of credits you need depends on the type of benefit you are applying for and the age at which you claim it.
How to check your Social Security benefit estimate
In 2026, workers earned one Social Security credit for every $1,890 earned, as noted in the report by Kiplinger. A maximum of four credits can be earned each year. To earn the maximum four credits in 2026, a person must earn at least $7,560 during the year. Both wages and self-employment income count toward these credits if they are subject to Social Security taxes. A worker needs 40 lifetime credits to qualify for retirement benefits. This generally means working for about 10 years.
Although the Social Security Administration (SSA) provides benefit estimates, understanding the calculation process helps people check whether the estimate is accurate, as noted by Kiplinger. SSA estimates may not always perfectly predict future benefits because they are based on current information and assumptions. People can get a personalized estimate by downloading Form SSA-7004 from the SSA website, according to Kiplinger. The form estimates benefits at age 62, full retirement age, and age 70.
A report by Kiplinger outlined six main steps to estimate Social Security benefits more accurately.
Step 1: Check your earnings record
To receive retirement benefits, a person must be at least 62 years old and have paid Social Security taxes for 10 years or more, as stated by the Kiplinger report. People who delay claiming benefits until their full retirement age (FRA) or age 70 usually receive larger monthly payments. Social Security calculates benefits using a person’s Average Indexed Monthly Earnings (AIME), based on their 35 highest-earning years. The Social Security Administration keeps records of earnings from every year a person has worked. In 2026, Social Security taxes apply only to the first $184,500 of earnings. This limit is $8,400 higher than in 2025.
Step 2: Adjust income for inflation
Social Security adjusts past earnings using the Average Wage Index (AWI). This reflects how wages have grown across the country over time. The adjustment prevents older, lower salaries from being unfairly compared with modern wages. Future Social Security payouts also account for inflation before retirement. The SSA provides indexing factors that help people adjust their earnings correctly, according to the report by Kiplinger. Users enter the year they turned 60 to find the proper factors.
Step 3: Calculate your average earnings
To calculate Average Indexed Monthly Earnings (AIME), add together earnings from the 35 highest-paid years. If a person has worked fewer than 35 years, all available earnings are included. Years without earnings are counted as zero and lower the final benefit amount. Kiplinger mentioned that after adding the earnings, divide the total by 420 months, which equals 35 years. The result is rounded down to the nearest dollar and becomes the worker’s AIME.
Step 4: Work out your benefit amount
The Primary Insurance Amount (PIA) is the basic monthly benefit a person can receive at full retirement age. For 2026, the PIA calculation uses special income thresholds known as “bend points”. The calculation includes 90% of the first $1,286 of AIME. It also includes 32% of AIME between $1,286 and $7,749. Any AIME above $7,749 is multiplied by 15%. These three amounts are added together to determine the PIA. The final figure is rounded down to the next lower multiple of 10 cents.
Step 5: Know your retirement age
Waiting until full retirement age generally helps workers receive the largest standard monthly benefit. People can claim benefits earlier, but their monthly payments will be permanently reduced. Workers who delay retirement beyond FRA and continue working may qualify for delayed retirement credits. This increases monthly benefits.
People born between 1943 and 1954 have a full retirement age of 66, according to the Kiplinger chart. For those born in 1955, FRA is 66 years and 2 months. For people born in 1956, FRA is 66 years and 4 months. For those born in 1957, FRA is 66 years and 6 months. For people born in 1958, FRA is 66 years and 8 months. For those born in 1959, FRA is 66 years and 10 months. For anyone born in 1960 or later, FRA is 67 years.
Proposals to raise the full retirement age from 67 to 69 continue to be debated. People who claim benefits up to 36 months early face a reduction of 5/9 of 1% per month, as noted in the report by Kiplinger. Those claiming more than 36 months early face an additional reduction of 5/12 of 1% per month.
Step 6: Check Medicare deductions
Medicare Part B premiums are automatically deducted from Social Security checks for seniors enrolled in Medicare. The 2026 Medicare Part B premium is $202.90 per month. This is higher than the $185 premium in 2025. People who are not enrolled in Medicare do not have this deduction taken from their Social Security benefits.
Key things to remember
A person generally needs at least 10 years of work history to qualify for Social Security retirement benefits. Benefits are mainly based on the worker’s 35 highest-earning years. The age at which a person starts collecting benefits can increase or reduce monthly payments, as stated by Kiplinger.
Workers receive 100% of their standard benefit when they claim at their full retirement age. People can also use the Social Security calculator on their online Social Security account to estimate benefits.