How Social Security Benefits Are Calculated
Social Security retirement benefits are based on your highest 35 years of earnings, adjusted for wage inflation. The SSA converts your earnings into an Average Indexed Monthly Earnings (AIME), then applies a progressive formula with bend points to determine your Primary Insurance Amount (PIA).
2026 Benefit Formula (Bend Points)
| AIME Range | Replacement Rate |
|---|---|
| First $1,226 | 90% |
| $1,226 – $7,391 | 32% |
| Above $7,391 | 15% |
This estimate assumes you claim at your Full Retirement Age (67 for those born 1960+). Claiming at 62 reduces benefits by up to 30%; delaying to 70 increases benefits by 24% (8%/year from FRA). For a precise estimate, create a mySocialSecurity account at ssa.gov.
Frequently Asked Questions
The maximum monthly benefit for someone retiring at full retirement age in 2026 is approximately $3,822. This applies to workers who earned at or above the wage base for 35+ years.
Yes. The SSA uses your highest 35 earnings years. Working additional years can replace lower-earning years in the calculation, boosting your AIME and benefit.