SSA logo: link to Social Security Online home724. Basic Reduction Formulas

724.1 What are the basic reduction formulas?

There are four basic reduction formulas:

  1. A retirement insurance benefit is reduced by 5/9 of one percent (or 0.0056) for each month of entitlement before FRA;

  2. Wife's and husband's insurance benefits are reduced by 25/36 of one percent (or 0.0069) for each month of entitlement before FRA;

  3. Widow(er)'s insurance benefits are reduced for each month of entitlement between ages 60 and FRA. The amount of the reduction for each month is derived from dividing 28.5 percent by the number of possible months of early retirement. A person whose FRA is age 65 could be entitled up to 60 months before FRA. Each month is therefore 28.5 percent divided by 60 (or 0.00475). A person whose FRA is age 66 could be entitled up to 72 months before FRA. Each month is therefore 28.5 percent divided by 72 (or 0.00396). Widow(er)'s insurance benefits payable before age 60 based on disability are not further reduced for months before age 60; and

  4. Retirement insurance benefits and spouse's benefits are reduced by 5/12 of one percent (or 0.0042) for each month of reduction in excess of 36 months. This applies to individuals whose full retirement age is after age 65. (See §723.)

724.2 How does the reduction formula affect retirement insurance benefits?

No matter what your full retirement age is, you may start receiving benefits as early as age 62. However, if you start your benefits early, they are reduced a fraction of a percent for each month before your full retirement age. This reduction is permanent.

724.3 How does the reduction formula affect widow(er)'s insurance benefits?

You can start receiving aged reduced widow(er)'s benefits at age 60. The most your widow(er)'s benefits can be reduced is 28.5% of the wage earner's PIA. Also, if you start receiving your widow(er)'s benefits at full retirement age and your deceased spouse received reduced benefits, your widow(er)'s benefits will always be reduced.

724.4 How does the reduction formula affect wife's or husband's insurance benefits?

A spouse can choose to retire as early as age 62, but doing so may result in a benefit as little as 32.5 percent of the worker's primary insurance amount. A spousal benefit is reduced 25/36 of one percent for each month before normal retirement age, up to 36 months. If the number of months exceeds 36, then the benefit is further reduced 5/12 of one percent per month. There is no reduction for the prior entitlement as a wife or husband.

Last Revised: Feb. 2, 2009