Doubling your salary can increase your lifetime earnings, but your Social Security benefit will not increase at the same rate. As your career earnings rise, each additional dollar has a smaller effect on your monthly benefit. Comparing salaries of $75,000 and $150,000 can show how that difference could affect your retirement income.
Why Twice the Salary Doesn’t Mean Twice the Social Security
Social Security benefits are not determined by your current salary alone. The program generally uses your 35 highest years of wage-adjusted earnings to calculate your average indexed monthly earnings (AIME). It then applies a progressive formula to that…
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