Social Security Disability Insurance Practice Test

The statement that the Primary Insurance Amount (PIA) is a determination of the amount equal to the worker’s full retirement benefit at full retirement age is accurate. The PIA is a crucial figure used in calculating Social Security retirement benefits. It represents the monthly benefit amount a worker is entitled to receive when they reach full retirement age, based on their earnings history, which reflects how much they contributed to the Social Security system.

The PIA is calculated based on the worker's Average Indexed Monthly Earnings (AIME), which takes into account the worker's highest-earning years adjusted for wage growth and inflation, leading up to the year before they claim benefits. At full retirement age, a worker is eligible to receive their PIA without any adjustments or reductions that could occur if they claim benefits earlier. This means that the PIA accurately reflects the full retirement benefit amount a worker can expect to receive at that milestone.