Primary Insurance Amount

The Primary Insurance Amount (PIA[1]) is a component of Social Security provision in the United States.

[2][3] For the purposes of the United States Social Security Administration, PIA is used as the beginning point in calculating the annuity payment of benefits that is provided to an eligible recipient each month during retirement until the recipient's death.

Generally, the more a person pays in FICA taxes during their life, the higher their PIA will be.

[2] Monthly Social Security benefits at full retirement age are determined through adjusting AIME by multipliers at specific earnings thresholds, which are called "PIA bend points".

[7] For 2023, the PIA computation formula is:PIA = 0.90*(AIME up to $1115) + 0.32*(AIME between $6721 and $1115) + 0.15*(AIME - $6721)Accordingly, a beneficiary's PIA will be the sum of: (a) 90 percent of the first $1115 of average indexed monthly earnings, plus (b) 32 percent of average indexed monthly earnings between $1115 and $6721, plus (c) 15 percent of average indexed monthly earnings over $6721[8] The actual amount of benefits provided to the recipient depends on the age at which they claim their social security benefits, relative to their full retirement age.

[7] Eligible individuals who collect their benefits at full retirement age will receive their calculated PIA.

Contrary to common perception, it is still possible to receive retirement benefits and still continue to work.

[10] Since the Social Security Act was first signed in 1935, new legislation has provided for various ways of computing the PIA.

All benefits payable to beneficiaries eligible after 1978 may use the 1978 New Start Method,[13] also known as the Average Indexed Monthly Earnings (AIME) PIA.