Years in the Benefit Calculation

The formula for calculating retired workers’ Social Security benefits includes their time in covered employment, their earnings up to the taxable maximum, and the age at which they claim benefits.

An average of the worker’s highest 35 years of earnings forms the base of a Social Security benefit. To improve solvency, some proposals would increase this number to 38. This is equivalent to a permanent average benefit reduction of about 3 percent. The reduction for women, who are less likely to have continuous work histories, could be greater.