Many people wonder how their benefit is figured. Social Security benefits are based on your lifetime earnings. Your actual earnings are adjusted or “indexed” 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. We apply a formula to these earnings and arrive at your basic benefit, or “primary insurance amount” (PIA). This is how much you would receive at your full retirement age — 65 or older, depending on your date of birth.For people born in 1946:90% of first $71132% of excess above $711 (up to $4288)15% of amount above $4288+ COLA for people working past age 62.http://www.ssa.gov/pubs/10070-08.html================================================Used excel to compute the increase in benefit if I earn $100K or if I earn $0 in 2012 = $28 per month difference
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