Glossary & FAQ

The average of your highest 35 years of earnings, indexed for wage growth and divided by the number of months. AIME is the input to the PIA formula.

The monthly benefit you receive if you start at your full retirement age. It is calculated from your AIME using a three-tier "bend point" formula.

The age at which you qualify for 100% of your PIA. It ranges from 65 to 67 depending on your year of birth (67 for anyone born in 1960 or later).

An annual increase in benefits tied to inflation (the CPI-W). SSA announces the COLA each October, effective the following January.

The dollar thresholds in the PIA formula (for 2026, $1,286 and $7,749) where the percentage applied to your AIME changes from 90% to 32% to 15%.

A rule that could reduce Social Security benefits for people who also receive a pension from work not covered by Social Security. Repealed by the Social Security Fairness Act of 2023, effective for benefits payable after December 2023.

A rule that could reduce spousal or survivor benefits for people receiving a government pension from non-covered employment. Also repealed by the Social Security Fairness Act.

Credits that increase your benefit by 8% per year for each year you delay claiming past full retirement age, up to age 70.

The payroll tax that funds Social Security and Medicare. Employees and employers each pay 6.2% for Social Security and 1.45% for Medicare.

The formal name for the Social Security program, covering retirement, survivors, and disability benefits.

The Old-Age and Survivors Insurance trust fund, which pays retirement and survivor benefits. Funded by payroll taxes and reserves.

The Disability Insurance trust fund, which pays benefits to disabled workers and their dependents.

A surcharge added to Medicare Part B and Part D premiums for beneficiaries with higher incomes, based on your tax return from two years prior.

Benefits for workers who become disabled and have enough work credits. The amount is based on your earnings record.

A needs-based program for people who are aged, blind, or disabled and have limited income and resources. Funded by general tax revenue, not payroll taxes.

If you claim before full retirement age and keep working, SSA may temporarily withhold benefits if your earnings exceed an annual limit. Withheld amounts are restored later.

The maximum annual earnings subject to Social Security tax ($184,500 in 2026). Earnings above this are not taxed for Social Security and do not count toward benefits.

Credits earned through work and used to qualify for benefits. You can earn up to four per year; most people need 40 credits (about 10 years) to qualify for retirement benefits.

A benefit of up to 50% of a higher-earning spouse’s PIA, available at the claiming spouse’s full retirement age (reduced if claimed earlier).

A benefit paid to a surviving spouse or eligible family member, worth up to 100% of the deceased worker’s benefit at the survivor’s full retirement age.

The earnings threshold SSA uses to decide whether a person is working at a level that disqualifies them from disability benefits.

A person or organization SSA appoints to manage benefits for someone who cannot manage their own payments.

The free online account at ssa.gov that lets you view your earnings record, estimate benefits, and manage your information.

Hospital insurance covering inpatient stays, skilled nursing, hospice, and some home health care. Most people pay no premium.

Medical insurance covering doctor visits, outpatient care, and preventive services. It carries a monthly premium.

Private plans that bundle Part A and Part B (and often Part D) coverage, sometimes with extra benefits.

Prescription drug coverage offered through private plans approved by Medicare.

The annual earnings amount below which no benefits are withheld under the earnings test for those who claim before FRA.

The state-level review process (Disability Determination Services) that decides whether a claimant meets SSA’s definition of disability.

The independent office that audits and investigates SSA programs to detect fraud, waste, and abuse.

The accumulated assets in the OASI and DI trust funds, held as special-issue Treasury securities, used to pay benefits when taxes alone fall short.

The Consumer Price Index for Urban Wage Earners and Clerical Workers, the inflation measure used to calculate the annual COLA.

The worker on whose earnings record a benefit is paid, as opposed to auxiliary beneficiaries such as spouses and children.

Benefits paid to family members (spouses, children, parents) based on a worker’s earnings record.

The income measure (adjusted gross income plus tax-exempt interest plus half of Social Security benefits) used to determine how much of your benefit is taxable.

A free, voluntary SSA program that helps disability beneficiaries who want to work find employment support services.

An alternative benefit calculation that provides a higher payment for certain long-term, low-wage workers.

The cap on total benefits payable to a family on one worker’s record, generally 150% to 188% of the worker’s PIA.

The first level of appeal after an initial disability denial, in which a different examiner reviews the claim.

The requirement that a worker have enough recent work credits (the "20/40" rule for most adults) to qualify for SSDI.

An official SSA letter proving your benefit amount and status, often needed for loans, housing, or assistance programs.

A one-time payment of $255 to an eligible surviving spouse or child when a worker dies.

The process of adjusting past earnings to current wage levels so benefits keep pace with rising standards of living.

A measure used in the Trustees Report of whether projected income will cover projected costs over a 75-year period.

A 2023 law that repealed the Windfall Elimination Provision and Government Pension Offset, raising benefits for many public-sector retirees.