Retirement Social Security

Your Social Security Estimate May Be Overstating Your Check - Here's Why

Here's why your Social Security estimate might not be entirely accurate.

By Paige Cerulli , Edited by Laura Hohenstein

Updated Nov. 8, 2026

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Understanding how much you're likely to receive in Social Security senior benefits may be important to helping you plan your retirement. Your Social Security statement may help you understand your benefits, providing estimates of the benefits you may receive at different ages. Though the statement provides you with a starting point, there are several reasons why it might be overestimating your check.

Here's what you need to know about your Social Security statement, how to get it, and the essential details that your statement doesn't reflect.

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The statement reflects your most current earnings

Your Social Security statement uses your most recent year of earnings recorded, and it uses that figure to fill in the gaps until your retirement. In doing so, the estimator assumes that your income stays the same until you claim your benefits.

The problem is, Social Security benefits are calculated based on your 35 highest-earning years. That income is indexed to wage growth, added together, and then averaged. The estimator assumes that you'll continue working until retirement, but if you change careers, drop down to part-time work, take a pay cut, or stop working before claiming Social Security benefits, your benefits may decline because of the change in your work history.

Individuals with gaps in their work record are the most exposed. The assumed future years of work replace any years with low or zero income in the formula, but if you don't end up working, those years of low or zero income may bring down your benefits. Individuals with strong, full 35-year work histories should see roughly the same estimate even if they don't continue working until retirement.

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The distinction between retirement date and claiming date

Your Social Security statement also doesn't reflect the fact that your retirement date and claiming date are separate decisions. You could decide to stop working at age 62 and still wait until age 70 to claim your benefits.

Claiming benefits at age 62, before you reach your full retirement age, could reduce your benefits by up to 30%. On the other hand, waiting to claim benefits until after your full retirement age may increase your benefits by approximately 8% for every year, up to age 70.

These factors aren't incorporated into the statement, but they could significantly impact your benefits.

The absence of the earnings test

Social Security statements also disregard the implications that continuing to work while collecting benefits could have on your check. If you claim benefits before your full retirement age while continuing to work, the earnings test applies. For 2027, the earnings test limit for people reaching full retirement age after 2027 is $25,560. For people reaching full retirement age in 2027, the limit is $67,920.

If your wages, including from a part-time job, exceed the test limit, the Social Security Administration (SSA) withholds a portion of your benefits. For people reaching full retirement age after 2027, the SSA withholds $1 of benefits for every $2 of earnings that exceed the amount. For people reaching full retirement age in 2027, the SSA withholds $1 in benefits for every $3 of earnings exceeding the amount.

Once you reach full retirement age, the SSA recalculates your benefits and includes the benefits that have been withheld, but until then, the earnings test could reduce your checks.

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The Medicare Part B premium's effect on your benefits

Your Social Security statement may provide an estimate of your monthly benefits, but keep in mind that your Medicare Part B premium also comes out of that check. Medicare Part B premiums are typically automatically deducted from your benefits, reducing the amount of money that's actually deposited into your account.

Federal taxation of Social Security benefits

You may have to pay federal taxes on up to 85% of your Social Security benefits. You may have to pay taxes if you file a Federal tax return as an individual and have a combined income of more than $25,000. If you file a joint return and you and your spouse have a combined income of more than $32,000, you may have to pay taxes on your benefits.

These taxes aren't reflected in the Social Security statement, and paying taxes on your Social Security benefits may reduce the amount of cash that you have at the end of the month or year.

Potential errors in your earnings report

Errors in your earnings report may also skew your benefits estimate. Missing earnings, such as if your employer reported your earnings incorrectly or if your employer used the wrong name or Social security number, may affect your benefits. It's important to report any incorrect earnings to correct the issue so you receive your correct benefits amount.

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Bottom line

Your Social Security statement may give you a starting point, but it may also overstate your benefits, which could impact your retirement planning. Consider modeling a zero-future earnings estimate using the SSA's online benefits calculator; enter zero into each future year to create the estimate.

The resulting figure may give you a more realistic estimate of your benefits that you may use to review your retirement plan and make sure you're still on track to meet your retirement goals.

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