Your Social Security retirement benefit is built from a formula with two dollar thresholds called bend points. For people who first become eligible in 2027 the bend points are $1,340 and $8,077.
This guide gives the 2027 formula, how average indexed monthly earnings turn into a primary insurance amount, worked examples, how the bend points are set and the family maximum formula, all from SSA's notice in the Federal Register of 26 October 2026.
| Part of average indexed monthly earnings (AIME) | Percentage counted |
|---|---|
| First $1,340 | 90% |
| $1,340 to $8,077 | 32% |
| Above $8,077 | 15% |
The Social Security Administration (SSA) calls $1,340 and $8,077 the bend points. They apply to individuals who first become eligible for old-age or disability insurance benefits in 2027, or who die in 2027 before becoming eligible. The result is the primary insurance amount (PIA), rounded down to the next lower multiple of $0.10.
| AIME | 90% part | 32% part | 15% part | PIA (rounded down to $0.10) |
|---|---|---|---|---|
| $1,000 | $900.00 | $0.00 | $0.00 | $900.00 |
| $3,000 | $1,206.00 | $531.20 | $0.00 | $1,737.20 |
| $6,000 | $1,206.00 | $1,491.20 | $0.00 | $2,697.20 |
| $8,077 | $1,206.00 | $2,155.84 | $0.00 | $3,361.80 |
| $10,000 | $1,206.00 | $2,155.84 | $288.45 | $3,650.20 |
These are our calculations from the published bend points and percentages, not SSA examples. They show the PIA, which is the benefit at normal retirement age before any early-claiming reduction, delayed credits or later cost-of-living increases; the notice we used does not cover those.
SSA first determines the required number of years of earnings, indexes the earnings, selects the years with the highest indexed earnings, adds them, divides by the total number of months in those years and rounds the average down to the next lower dollar. The result is the AIME.
The formula's first bend points in 1979 were $180 and $1,085. SSA multiplies each by the ratio of the national average wage index for 2025 ($72,800.33) to that for 1977 ($9,779.44), getting $1,339.96 and $8,076.98, which it rounds to $1,340 and $8,077. The 3.6% cost-of-living increase from December 2026 does not apply to people first eligible after 2026; they get the new bend points instead. See our 2027 cost-of-living adjustment guide.
The same notice sets the family-maximum formula for the family of a worker who becomes age 62 or dies before age 62 in 2027: total benefits may not exceed 150% of the first $1,712 of the worker's PIA, plus 272% of the PIA from $1,712 to $2,471, plus 134% of the PIA from $2,471 to $3,223, plus 175% above $3,223, rounded down to the next dime. For a PIA of $2,000 that limit is $3,351.30, and for a PIA of $3,000 it is $5,341.30 (our calculations).
Social Security Administration: Cost-of-Living Increase and Other Determinations for 2027 (Federal Register, 26 October 2026), Federal Register official PDF (govinfo.gov), 91 FR 67380.