Social Security Benefits Calculator

How your benefit is calculated

Unlike private pensions or defined-contribution plans, Social Security benefits are determined by a progressive statutory formula based on your lifetime covered wages:

• Covered Earnings: Only wages subject to FICA payroll tax up to the annual Social Security Taxable Maximum (e.g., $176,100 in 2025 and $184,500 in 2026) are credited.
• 35-Year Rule: SSA always calculates retirement benefits across exactly 35 computation years. If you worked fewer than 35 years, zero-earning years are factored in, reducing your average.
• National Average Wage Indexing (AWI): Earnings prior to age 60 are indexed to growth in national average wages to maintain historical purchasing power.

The 3-tier PIA bend point formula

Once your top 35 years are indexed and divided by 420 months to determine your Average Indexed Monthly Earnings (AIME), SSA applies two statutory "bend points" for your eligibility cohort:

• 90% of AIME up to the first bend point
• 32% of AIME between the first and second bend points
• 15% of AIME above the second bend point

The sum of these three tiers produces your raw Primary Insurance Amount (PIA), which is then rounded down to the nearest ten cents ($0.10).

Work, recomputations, & claiming strategy

How does continuing to work impact your future checks?

• Replacing Lower-Earning Years: If future annual earnings exceed any year currently in your top 35, the lower year is dropped and your AIME increases.
• Statutory Recomputations: If you work in the year you claim benefits or subsequent years, earnings in or after your entitlement year trigger automatic recomputations effective January 1 of the following year. Recomputations can never reduce your check.
• Working While Claiming Early: If you claim before your Full Retirement Age and continue working, benefits may be temporarily withheld under the Social Security Earnings Test.
• Optimizing Claiming Age: Once your PIA is determined, use our Claiming Age Calculator to compare starting at 62, FRA, or age 70 with lifetime break-even curves.