Understanding the Average-Monthly-Wage Method for Calculating Your Primary Insurance Amount, § 404.220

If you reached age 62, became disabled, or died before 1979, the Social Security Administration (SSA) may calculate your primary insurance amount (PIA) using the average-monthly-wage method.

https://www.ssa.gov/OP_Home/cfr20/404/404-0220.htm

This method can also apply under certain conditions if you reached age 62 between 1979 and 1984. In this blog post, we’ll break down the average-monthly-wage method to help you better understand how your PIA is calculated.

The Average-Monthly-Wage Method Explained:

1. Determine your eligibility: To be eligible for this method, you must have reached age 62, become disabled, or died before 1979. If you reached age 62 between 1979 and 1984, specific conditions may apply for you to be eligible.
2. Compute your average monthly wage: Your average monthly wage is calculated based on your earnings, as described in § 404.221.
3. Refer to the benefit table in appendix III: The benefit table helps determine your PIA based on your average monthly wage and other factors.
4. Find your primary insurance amount (PIA) in the benefit table: Your PIA can be found in the benefit table, as explained in § 404.222.
5. Apply any automatic cost-of-living or ad hoc increases: Any cost-of-living or ad hoc increases that became effective in or after the year you reached age 62, became disabled, or died before age 62 are applied to your PIA, as described in §§ 404.270 through 404.277.

Conclusion: The average-monthly-wage method is an important part of calculating your primary insurance amount for Social Security disability benefits. By understanding this method, you can gain a better understanding of your potential benefits and how they are determined. If you have any questions about your eligibility or the average-monthly-wage method, consider contacting the Social Security Administration for assistance.