The family maximum is the maximum monthly benefit that your family is entitled to earn, based on your earnings record. This is one of the more complex Social Security rules. Essentially, the family maximum limits the total benefits payable to a beneficiary’s family with children below the age of 18.
For the family of a worker who becomes age 62 or dies in 2017 before attaining age 62, the total amount of benefits payable will be computed so that it does not exceed:
- 150 percent of the first $1,131 of the worker’s PIA, plus
- 272 percent of the worker’s PIA over $1,131 through $1,633, plus
- 134 percent of the worker’s PIA over $1,633 through $2,130, plus
- 175 percent of the worker’s PIA over $2,130.
Typically, the maximum family benefit is 150 to 180 percent of your primary insurance amount.
Great Joe, but what is the average indexed monthly earnings (AIME) figure?
Here is the definition directly from SSA.gov:
The dollar amount used to calculate your Social Security benefit if you attained age 62 or became disabled (or died) after 1978. To arrive at your AIME, we adjust your actual past earnings using an “average wage index,” so you won’t lose the value of your past earnings (when money was worth more) in relation to your more recent earnings. If you attained age 62 or became disabled (or died) before 1978, we use Average Monthly Earnings (AME).
If your head is spinning like mine was the first time I reviewed this information, I will also tell you a little secret: it still confuses me sometimes. I promise I am going to make it very simple for you to understand your family maximum. You do not have to use formulas or average indexed monthly earnings. All you have to do is check out your annual benefit statement or view your online account. See, I told you I would make it easier!
Here is a sample benefits statement from SSA.gov for “Wanda Worker”:
As you can see from the highlighted portion, “Wanda Worker’s” family maximum is $2,908 per month, or roughly 173 percent of her primary insurance amount: $1,680. Pull out your benefit statement and see what your number is. Better yet, go online and view your my Social Security account. Just click on the Estimated Benefits tab, next to Overview and you will see it listed about halfway down the page under the Survivors section.
Get Your Account Started!
Haven’t set up your my Social Security online account? What are you waiting for (LOL)? Don’t worry ☺ Here is a step-by-step video tutorial I created just for you. What are you waiting for? Watch the video and set up your account now, please!
As you can see from this article, the family maximum rules are very confusing and will affect everyone’s situation in a different way. The most important thing is that you know it exists.
Additionally, if you want a comprehensive review, please take a look at our Social Security Solution Program. I put this program together specifically from the feedback I have received from clients and readers of Social Security Teacher. This solution is designed for those of you who want help and guidance in making the best decision for you and your family. I am a CERTIFIED FINANCIAL PLANNER™ professional, and have the experience to help you get there.