Ask Social Security Questions and Get Answers ASAP
Many people wonder how the SSA figures their Social Security retirement benefit.The Social Security Administration bases Social Security benefits on your lifetime earnings. They adjust or “index” your actual earnings to account for changes in average wages since the year the earnings were received.Then Social Security calculates your average indexed monthly earnings during the 35 years in which you earned the most. And after that- they apply a formula to these earnings and arrive at your basic benefit, or “primary insurance amount.”This is how much you would receive at your full retirement age — 65 or older, depending on your date of birth.
So if your current earning is lower - and these years are NOT included into g the 35 years in which you earned the most - your social security benefits are NOT recalculated - and may be only affected by COLA adjustment.
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