Bend Points
Definition
Bend points are dollar thresholds used in the Social Security formula to calculate your Primary Insurance Amount (PIA). The formula replaces a higher percentage of lower earnings and a lower percentage of higher earnings.
More Detail
The Social Security benefit formula is designed to be progressive. It applies three different percentages to three portions of your Average Indexed Monthly Earnings (AIME). The boundaries between those portions are called bend points. For example, in 2024, the formula replaces 90% of the first $1,174 of AIME, 32% of the amount between $1,174 and $7,078, and 15% of AIME above $7,078. Bend points are adjusted annually.
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