Can earnings after the Full Retirement Age (FRA) be included in the Average Indexed Monthly Earnings (AIME) calculation?

The correct answer is that earnings after the Full Retirement Age (FRA) can indeed be included in the Average Indexed Monthly Earnings (AIME) calculation as part of a rolling computation. AIME is used to determine the Primary Insurance Amount (PIA) for Social Security benefits, and it can be adjusted based on the lifetime earnings of the beneficiary, including those earned after FRA.

When individuals continue to work beyond their FRA, their additional earnings can help to increase their AIME, which could potentially lead to higher benefits upon recalculation. This feature of Social Security allows for a more favorable adjustment of benefits for those who choose to extend their working years.

The rolling computation aspect is important because it means that earnings from any year can be used to recalculate AIME. The Social Security Administration (SSA) uses the highest 35 years of indexed earnings to calculate AIME, and if new, higher-earning years are added to this mix, it could improve the AIME, thereby increasing the Social Security benefit.

This process helps ensure that beneficiaries are rewarded for their work even after they have reached retirement age, demonstrating a flexible approach to earnings and benefits in the Social Security system.