SSA logo: link to Social Security Online home710. How is the Primary Insurance Benefit (PIB) computed under the simplified old-start formula?

The PIB is computed from the AME under the simplified old-start formula as follows:

  1. Take 40 percent of the first $50 of the AME;

  2. Add 10 percent of the next $200 of the AME;

  3. Increase the sum by one percent for each increment year; and

    Note: The number of increment years is the number, not more than 14 or less than four, that is equal to your total pre-1951 earnings divided by $1,650. Ignore any fraction.

  4. Round the total to the nearest cent. The result is the PIB. You can convert the PIB to the PIA by using the benefit table that was in the Social Security Act as of December 31, 1978. Be sure to add any cost-of-living increases beginning with the year of eligibility or death. (See §706.)