In 2025, Social Security benefits went up for everyone, such as retirees, people getting Supplemental Security Income (SSI), and those receiving disability benefits (SSDI), due to a 2.5% cost of living adjustment (COLA).
Good news for retirees: their monthly payments will increase, which is helpful because prices for goods and services went up in 2024, making it harder for them to buy what they need. The maximum Social Security benefit is $5,108, and if you want to reach this amount in 2025, here are three things you need to do.
Three key factors in calculating Social Security payments
The monthly amount that a person receives from Social Security depends on three fundamental elements:
- First, the income history: The Social Security Administration (SSA) analyzes income earned throughout your working career. They are adjusted for inflation until the year the person turns 60. Subsequently, the 35 years with the highest income are selected, whose average is used in the formula to calculate the monthly benefit.
- Second, the year of birth: This factor determines the full retirement age (FRA, for its acronym in English). For those born between 1943 and 1954, the FRA is 66 years, progressively increasing to 67 for those born in 1960 or later.
- Third, the age when applying for benefits: Applying for benefits before reaching FRA results in a permanent monthly reduction. On the other hand, delaying the application until age 70 increases the monthly amount by approximately 8% for each year after FRA.
To get the appealing monthly payment of $5,108, the applicant needs to meet several strict requirements. You need to reach or go above the yearly income limit for at least 35 years.
In 2025, this limit will be $176,100 based on information from the SSA. The person should wait until they are 70 years old to apply for benefits, as there are no further increases after that age.
The taxable income limit, which is adjusted every year for inflation, went up to $168,600 in 2024. This change was approved by the Social Security Administration (SSA) to reflect the cost of living.
Who qualifies for the maximum benefit of $5,108 per month
Only a few workers qualify to receive the highest monthly benefit. In 2025, only people born in 1955 who turn 70 this year will qualify to receive the full $5,108, provided they meet the other requirements.
If you were born in earlier years, your benefits are a bit lower because of changes in how Social Security calculations are made. For instance, people born in 1954 can get up to $5,090. Even though the difference is small, it shows how slight changes to the formula affect the final result.
The most important thing is to keep earning a good income after turning 60. This is because inflation adjustments stop at age 60, but the income limit for taxes keeps going up every year. So, the money you make between ages 60 and 70 is likely the most important for calculating your benefits.
Choosing the best age to retire depends on your personal situation and options. It is a good idea to talk to a financial advisor or retirement expert for reliable advice.
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