What does the Primary Insurance Amount (PIA) refer to?

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The Primary Insurance Amount (PIA) is the monthly benefit amount a worker is eligible to receive upon reaching full retirement age, assuming they have applied for Social Security retirement benefits. It is fundamentally tied to a person's earnings history and the amount they contributed to the Social Security system during their working years. The PIA is calculated based on a formula that accounts for the highest 35 years of earnings adjusted for inflation, ensuring that benefits reflect the individual's lifetime earnings.

Choosing PIA as the full retirement benefit at a set age highlights its significance in Social Security, as it determines the baseline amount a retiree will receive. This figure can be influenced by factors such as the age at which benefits are claimed, but the PIA itself represents what the benefits would be if claimed at the full retirement age.

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