ACTUARIAL NOTE SOCIAL SECURITY ADMINISTRATION

Number 162

April 2021 Office of the Chief Actuary

Baltimore, Maryland

DIMINISHING EFFECT OF THE SPECIAL MINIMUM PIA

by Craig A. Feinstein

Background

The Primary Insurance Amount (PIA) is the amount that

a primary beneficiary (that is, a worker) receives if he or

she becomes initially entitled to Social Security benefits

at Normal Retirement Age or at the time of disability.

The benefit amounts of the worker’s auxiliaries or survivors are based on specified percentages of the PIA.

There are several formulas for determining the PIA, but

for most current beneficiaries it is determined under a

wage-indexed formula (described later) if the worker

attained age 62, became disabled, or died after 1978.

Enacted in 1972 by Public Law 92-603, the special minimum PIA is an alternative to the wage-indexed PIA that

can give people with low earnings over a long working

lifetime, along with their auxiliaries and survivors,

higher monthly Social Security benefits than would be

generated by the wage-indexed formula. In Actuarial

Notes 143 and 154, we investigated how much gain over

the wage-indexed PIA a beneficiary could possibly

receive from the special minimum PIA, and we also presented data on current recipients of the special minimum. In this note, we update Actuarial Note 154.

The Special Minimum PIA

The special minimum PIA for a worker is a function of

the number of years of coverage, n, before the year of

entitlement and after 1936 in which a specific amount of

earnings are credited. The years of coverage are determined as follows:1

(a) Prior to 1951—one year of coverage for each

$900 of aggregate earnings, not to exceed 14.

(b) After 1950 through 1978—one year of coverage

for any year with earnings no less than 25 percent of the contribution and benefit base for that

year. 

(c) After 1978 through 1990—one year of coverage

for any year with earnings no less than 25 percent of what the contribution and benefit base

would have been for that year had the 1977

Social Security Amendments not been enacted

(in other words, 25 percent of the “old-law”

contribution and benefit base).

(d) After 1990 to present—one year of coverage for

any year with earnings no less than 15 percent

of the “old-law” contribution and benefit base

for that year.

Thus, for a worker with no earnings prior to 1951, the

number of years of coverage, n, is the number of years

in which the earnings of the worker equal or exceed a

specified amount, mj

, for given year j. 

When n  10, the special minimum PIA is zero; otherwise, it is equal to a specific base value, b, times the

minimum of {20, n-10}, increased by the cost-of-living

adjustments (COLAs), based on increases in the CPI,

from the year 1979 (if applicable). The specific base

value, b, is determined by the date of entitlement:

(a) For dates of entitlement from January 1973

through February 1974, b = $8.50.

(b) For dates of entitlement from March 1974

through December 1978, b = $9.00.

(c) For dates of entitlement in 1979 or later,

b = $11.50.

For the years 1979 to 1981, after each COLA is applied

the product is rounded up to the next dime. Beginning in

1982, after each COLA is applied the product is rounded

down to the next dime.2

The Wage-Indexed PIA

For a worker born in or after 1930 who lives to attain

age 623 without any pension based on non-covered

employment or prior period of disabled worker benefit

entitlement, the wage-indexed PIA is a function of the

total of the 35 highest indexed annual earnings, with the

indexing based on the growth in national average wage

1 http://www.socialsecurity.gov/OACT/COLA/yoc.html

2 http://www.socialsecurity.gov/OACT/COLA/colaseries.html

3 The age of first eligibility for a retirement benefit.
2

index.4 The total of the indexed annual earnings from

these 35 years is converted to a monthly average by

dividing by 420 (=12×35) and then rounding down to

the next lower dollar. This amount is called the Average

Indexed Monthly Earnings (AIME). The wage-indexed

PIA at age 62 is then calculated by rounding down to the

next dime the sum of:

(a) 90 percent of the first b1 dollars of the AIME,

plus

(b) 32 percent of the AIME over b1 dollars and

through b2 dollars, plus

(c) 15 percent of the AIME over b2 dollars,

where b1 and b2 are the two bend points for the appropriate year of first eligibility.5

 Beginning in the year of

attainment of age 62, the wage-indexed PIA is increased

by applying COLAs each June before 1983 and each

December after 1982.6

The Maximum Gain of the Special Minimum 

PIA Over the Wage-Indexed PIA

Consider a person born in 1957 who is first eligible for

benefits in 2019 with no earnings before 1979, the year

of attainment of age 22. We want to find the maximum

possible gain that he or she can obtain if his or her PIA

is based on the special minimum PIA, rather than the

wage-indexed PIA. This problem can be thought of as

the optimization problem:

Maximize {SPMIN – PIA} over all possible earnings histories,

where we denote by SPMIN the special minimum PIA

and we denote by PIA the wage-indexed PIA.

We can show that the solution to this problem must be a

payment history in which the earnings in any of the 35

years of highest indexed earnings which is a year of

coverage do not exceed the minimum amount required

for a year of coverage in that year. To show this, assume

that we have a solution to the stated maximization

problem, i.e., an earnings history which maximizes the

difference {SPMIN – PIA}. If in this earnings history

there is a year of coverage, j, which is one of the 35

highest indexed annual earnings years and in which the

earnings exceed mj

, we can construct an earnings

history identical to the earnings history of that solution

except that the earnings for year j equal mj

. For this

modified earnings history, SPMIN will stay the same but

the AIME, and hence the PIA, will decrease, so the

difference {SPMIN – PIA} will increase, contradicting

our assumption that the original solution maximizes that

difference. Therefore, for an earnings history to

maximize the difference {SPMIN – PIA}, earnings in

any of the 35 highest indexed earnings years which is a

year of coverage, must not exceed mj

.

Using a similar argument, we can also show that:

(a) the solution to this problem must consist of an

earnings history in which the earnings in the 40

years that are not years of coverage equal zero;

and 

(b) the number of years of coverage in the solution

will not exceed 30.

Combining these results, we see that the 40 earnings

amounts in the earnings history (from the year of attainment of age 22 through the year of attainment of age 61)

that solve our maximization problem must either be mj

or 0, and the number of years that have earnings mj is no

less than 11 and no more than 30. Now, for each

n = 11,..., 30, the amount of the special minimum PIA

does not depend on which of the n years among the 40

are the years with earnings of mj

, but the amount of the

wage-indexed PIA does. In fact, the wage-indexed PIA

will be smallest when the n years are those with the n

smallest values of Mj

, where Mj denotes the wageindexed value of mj

. So to find a solution to our problem, we only need to consider 20 possible solutions,

namely the earnings histories consisting of mj

 for each

year j with one of the n smallest values of Mj

 and zero

for all other years. Once we find the maximum gain

from the special minimum PIA among these 20 possible

solutions, we obtain our answer.

Computational Results

Using the projected values for the national average wage

index (AWI), COLAs, PIA bend points, and minimum

amounts required for a year of coverage based on the

2020 Social Security Trustees Report,7 we found a solution to the stated problem by the method described

above. In addition, we also solved the problem for persons born in the years after 1932 and correspondingly

first eligible for benefits after 1994. The following table

presents for the earnings histories that solve the optimization problem the special minimum PIA, the wage- 4 http://www.socialsecurity.gov/OACT/COLA/AWI.html

5 http://www.socialsecurity.gov/OACT/COLA/bendpoints.html

6 https://www.socialsecurity.gov/OACT/COLA/colaseries.html 7 http://www.socialsecurity.gov/oact/tr/2020/
3

indexed PIA when government pension receipt is not

involved, and the advantage of the special minimum:

As we see, it was theoretically impossible for a worker

attaining 62 in 2017 to receive a benefit based on the

special minimum PIA that would exceed the benefit

based on the wage-indexed PIA. This changed for a

worker turning 62 in 2018 or 2019, when it became theoretically possible to receive a benefit based on the special minimum PIA that would exceed the benefit based

on the wage-indexed PIA. However, it was again theoretically impossible for a worker turning 62 in 2020 to

receive a benefit based on the special minimum PIA that

would exceed the benefit based on the wage-indexed

PIA.

For workers attaining age 62 after 2020, the estimate is

sensitive to the assumed path of assumed future AWI

and COLA increases. In order to give a sense of the

scope of this sensitivity, we also replicated the estimation procedure using alternatively the low-cost and highcost assumptions in the 2020 Trustees Report. Based on

these assumptions, we found that it will be impossible

for workers with years of first eligibility of 2022 and

2021 respectively and the years afterwards to receive a

benefit based on the special minimum PIA that would

exceed the benefit based on the wage-indexed PIA, as

indicated in table 1. The reason for the decrease over

time in the maximum gain from the special minimum

PIA relative to the wage-indexed PIA is that the special

minimum increases from one cohort to the next with

COLAs while the wage-indexed PIA increases from one

cohort to the next with AWI growth, and price levels

have generally grown more slowly than the average

wage in the past and are projected to continue to do so

under the Trustees’ assumptions.8

For the person born in 1957, table 2 displays, in order by

the value of Mj

, the rank, n, of Mj, the calendar year j,

the value of mj

, the value of Mj, and the maximum gain

of the special minimum given n years of coverage:

Table 1.—PIAs Based on Earnings Histories

Which Optimize the Effect of the Special Minimum PIA

Computation for Workers in Year of First Eligibility, 

Based on the 2020 Trustees Report

Year of first 

eligibility

Special

minimum

PIA

Wageindexed

PIA

Difference between 

special minimum and 

wage-indexed PIA

1995 $519.40 $419.20 $100.20 

1996 532.90 429.40 103.50

1997 548.30 446.30 102.00

1998 559.80 467.60 92.20

1999 567.00 494.50 72.50

2000 581.10 519.10 62.00

2001 601.40 547.70 53.70

2002 617.00 577.20 39.80

2003 625.60 590.80 34.80

2004 638.70 597.20 41.50

2005 655.90 612.30 43.60

2006 682.70 640.90 41.80

2007 705.20 662.50 42.70

2008 721.40 691.70 29.70

2009 763.20 721.10 42.10

2010 763.20 735.70 27.50

2011 763.20 724.00 39.20

2012 790.60 740.50 50.10

2013 804.00 762.40 41.60

2014 816.00 783.60 32.40

2015 829.80 789.10 40.70

2016 829.80 812.90 16.90

2017 832.20 835.20 -3.00

2018 848.80 840.00 8.80

2019 872.50 863.80 8.70

2020 886.40 890.20 -3.80

Intermediate assumptions (Alternative II)

2021 906.70 912.10 -5.40

Low-cost assumptions (Alternative I)

2021 914.70 912.70 2.00

2022 941.20 954.40 -13.20

High-cost assumptions (Alternative III)

2021 897.90 911.80 -13.90

8 The economic assumptions in the 2020 Trustees Report did not

reflect the potential effects of the COVID-19 pandemic on the economy.

Table 2.—Maximal Effect of the Special Minimum PIA 

Computation for a Worker Born in 1957 and

Retiring at Age 62 in 2019

n

Year of 

earnings

j

Amount required 

for year of 

coverage

mj

mj indexed by 

average wages

Mj

Maximum 

gain given

n years of 

coverage

1 1998 $7,605.00 $13,259.40 N/A

2 1999 8,055.00 13,303.08 N/A

3 2000 8,505.00 13,310.22 N/A

4 1997 7,290.00 13,375.87 N/A

5 1996 6,975.00 13,544.67 N/A

6 2007 10,890.00 13,562.65 N/A

7 1992 6,210.00 13,625.17 N/A

8 2006 10,485.00 13,650.86 N/A

9 2005 10,035.00 13,665.49 N/A

10 2016 13,230.00 13,686.87 N/A

11 2001 8,955.00 13,687.92 -$275.80

12 1991 5,940.00 13,704.27 -261.80

13 2004 9,765.00 13,784.38 -247.70

14 1995 6,795.00 13,840.44 -233.90
4

Thus, the minimum number of years of coverage needed

in order to receive the special minimum upon attainment

of age 62 in the year 2019 was 30.

Example Earnings of a Specific Worker

It is interesting to examine the actual earnings of a specific worker who became eligible for the special minimum PIA in 1998, the last year in which any workers

became eligible for a benefit based on the special minimum PIA, in order to see how close their earnings were

to the amounts required for a year of coverage for the

special minimum PIA. In order to satisfy this criterion,

we simulated a hypothetical earnings history of one such

worker born in 1936.9

Table 3 presents for this worker the simulated earnings

history, the amounts required for a year of coverage, and

the difference between them. The average difference

between them for all 30 years in which this worker was

covered turned out to be only $471, an average relative

difference of 17%. The covered earnings history for this

particular person are very close to the amounts required

for a year of coverage. The difference between the special minimum PIA and wage-indexed PIA for this particular worker was only $14.40, while the maximum

theoretical difference between the special minimum PIA

and wage-indexed PIA, when the earnings for each year

equal the amount required for coverage for each year,

was calculated to be $92.20 for 1998.

When examining Table 3, one will notice that from

years 1982 to 1990, the worker was not covered for the

special minimum PIA. In these years, the amount

required for a year of coverage was 25 percent of the

“old-law” contribution and benefit base. In 1991, the

amount required for a year of coverage decreased to

only 15 percent of the “old-law” contribution and benefit base, allowing this worker to be covered for the special minimum PIA until 1997.

15 2015 13,230.00 13,841.53 -220.20

16 2008 11,385.00 13,860.29 -206.00

17 2011 11,880.00 13,909.48 -191.90

18 2012 12,285.00 13,948.13 -177.90

19 1993 6,435.00 13,998.44 -163.90

20 2014 13,050.00 14,128.21 -150.60

21 2017 14,175.00 14,175.00 -137.50

22 2013 12,645.00 14,175.68 -124.70

23 2003 9,675.00 14,292.24 -110.80

24 1994 6,750.00 14,299.89 -97.80

25 2002 9,450.00 14,301.11 -85.10

26 2018 14,310.00 14,310.00 -71.20

27 2010 11,880.00 14,345.31 -58.70

28 2009 11,880.00 14,684.36 -46.50

29 1981 5,550.00 20,277.68 -19.20

30 1980 5,100.00 20,509.25 8.70

9 To protect against disclosing information about specific individuals, we modified the earnings history of a specific worker born in

1936 by adding a secret random number uniformly distributed

between -$200 and $200 to their earnings for each year. This did not

affect whether the worker was covered for the special minimum PIA

for any years; however, when we added a random number uniformly

distributed between -$300 and $300, this did affect whether the

worker was covered for some years.

Table 2.—Maximal Effect of the Special Minimum PIA 

Computation for a Worker Born in 1957 and

Retiring at Age 62 in 2019 (Cont.)

Table 3.—Example Earnings History of a 

Specific Worker Who Became Eligible for the 

Special Minimum PIA in 1998

Year

Modified 

Earnings

Amount required for a 

year of coverage Difference

1958 $540 $1,050 -510

1959 1,260 1,200 60

1960 1,674 1,200 474

1961 1,263 1,200 63

1962 1,639 1,200 439

1963 1,519 1,200 319

1964 1,819 1,200 619

1965 1,395 1,200 195

1966 1,665 1,650 15

1967 1,701 1,650 51

1968 2,251 1,950 301

1969 2,410 1,950 460

1970 2,632 1,950 682

1971 2,932 1,950 982

1972 2,857 2,250 607

1973 2,790 2,700 90

1974 3,426 3,300 126

1975 3,868 3,525 343

1976 4,351 3,825 526

1977 4,414 4,125 289

1978 5,006 4,425 581

1979 4,882 4,725 157

1980 6,206 5,100 1,106

1981 5,821 5,550 271

1982 5,590 6,075 -485

1983 6,166 6,675 -509

1984 6,118 7,050 -932

1985 6,318 7,425 -1,107

1986 6,778 7,875 -1,097

1987 6,853 8,175 -1,322

1988 6,816 8,400 -1,584

1989 6,891 8,925 -2,034

1990 7,096 9,525 -2,429

1991 7,472 5,940 1,532
5

Recipients of the Special Minimum PIA Benefit

The Master Beneficiary Record (MBR) is the administrative file of records of benefit entitlement for the OASI

and DI programs. We obtained information from the

MBR regarding the beneficiaries who are receiving the

special minimum PIA in December 2019, including the

amount of the “support PIA”—the PIA which would

have been used if not for the special minimum. For most

of the beneficiaries receiving the special minimum, we

calculated the gain in benefit due to the special minimum PIA as:

GAIN = MBA – MBA

where SUPPIA is the support PIA and MBA is the

Monthly Benefit Amount. The MBA may be less than or

greater than the PIA because the beneficiaries may have

retired earlier or later than the Normal Retirement Age

(NRA) or because of the family maximum provision.

For auxiliaries, the MBA is also based on a specified

percentage of the applicable PIA.

Some beneficiaries are entitled to both a primary and

secondary benefit. For dually-entitled beneficiaries

whose secondary benefit is based on a special minimum

PIA, we modified the formula to: 

GAIN = MBA – MAX { MBA, SAMBA}

to recognize the possibility that the secondary benefit

based on the support PIA might be smaller than the primary’s PIA. SAMBA represents the smaller actuariallyreduced MBA, the primary benefit.

The following table shows the number of entitled beneficiaries and the average gain due to the special minimum PIA by year of current entitlement and beneficiary

type as of May 2020, for those beneficiaries first entitled

in December 2019 or earlier and were still entitled as of

December 2019. We have not included beneficiaries

who are receiving a primary benefit based on the special

minimum but are dually entitled to a larger secondary

benefit not based on the special minimum, and hence are

not really gaining from the special minimum calculation.

S: Data suppressed to avoid disclosing information about specific individuals.

1992 7,349 6,210 1,139

1993 7,127 6,435 692

1994 7,409 6,750 659

1995 7,418 6,795 623

1996 7,558 6,975 583

1997 7,439 7,290 149

Table 3.—Example Earnings History of a 

Specific Worker Who Became Eligible for the 

Special Minimum PIA in 1998 (Cont.)

Year

Modified 

Earnings

Amount required for a 

year of coverage Difference





 





SPMIN

SUPPIA





 





SPMIN

SUPPIA

Table 4.—Number of Entitled Beneficiaries and Average Gain in Monthly Benefit Amount Due to the

Special Minimum PIA by Year of Current Entitlement and Beneficiary Type, for Beneficiaries 

Entitled in December 2019 (Values as of May 2020)

Entitlement 

Year

Worker Spouse Child Widow All beneficiary types

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

1975-1979 (S/) $56.51 — — (S/) — — — (S/) $18.84

1980-1984 278 52.93 — — 165 $38.07 14 $31.36 457 46.9

1985-1989 1,551 50.09 13 $30.96 211 37.74 126 41.95 1,901 48.05

1990-1994 2,501 61.25 58 24.25 112 35.6 286 41.76 2,957 57.67

1995-1999 2,076 76.06 87 34.71 64 37.4 415 41.45 2,642 68.33

2000-2004 2,140 77.30 135 34.57 39 36.00 438 39.62 2,752 68.62

2005-2009 2,587 72.48 165 35.87 27 32.17 506 38.81 3,285 65.13

2010-2014 3,201 73.90 185 35.91 38 28.25 447 39.63 3,871 67.68

2015-2019 2,391 82.37 161 38.24 45 29.79 293 40.66 2,890 74.86

Total (S/) (S/) 804 35.09 (S/) (S/) 2,525 40.19 (S/) 64.79
6

We see that the number of entitlements has been increasing until 2015, while the average gain of the special

minimum over the support PIA has been generally

increasing with entitlement year.

In the above table, the child category is the aggregated

result of children of three different categories of insured

workers. An eligible child beneficiary10 has a parent

who is either a retired worker beneficiary, a disabled

worker beneficiary, or a deceased insured worker. Children of retired and disabled workers are eligible for a

monthly benefit of one-half of the PIA, and children of

deceased workers are eligible for a monthly benefit of

three-fourths of the PIA.

Widows, including widowers, may be aged widow(er)s,

disabled widow(er)s, or young widow(er)s. Aged and

disabled widow(er)s are eligible for monthly benefits

equal to the full applicable PIA, with appropriate reductions for entitlement prior to NRA. Young widow(er)s

must be caring for a dependent child under age 16 and

are paid at the rate of three-fourths of the PIA. Table 5

presents data for children and widows by type of child

and widow.

S: Data suppressed to avoid disclosing information about specific individuals.

The following table provides information on the eligibility year of the worker and the basis for the support PIA,for families receiving the special minimum PIA entitled

in December 2019 or earlier:

10 Children are eligible if they are in one of three categories: a minor 

child under age 18, a student child aged 18 or19, or a disabled adult 

child age 18 or older whose disability began before age 18. 

Table 5.—Number of Entitled Child and Widow(er) Beneficiaries and Average Gain in Monthly Benefit Amount Due to 

the Special Minimum PIA by Year of Current Entitlement and Beneficiary Type, for Beneficiaries 

Entitled in December 2019 (Values as of May 2020)

Entitlement 

Year

Children of... Widow(er)s

Retired or disabled 

workers Deceased workers Aged Disabled Young

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

Number of 

beneficiaries

Average

gain

1975-1979 — — (S/) $47.17 — — — — — —

1980-1984 (S/) $49.15 164 38 14 $31.36 — — — —

1985-1989 (S/) 19.66 208 38 125 42.01 — — (S/) $33.97

1990-1994 10 28.52 102 36.29 286 41.76 — — — —

1995-1999 10 36.25 54 37.61 415 41.45 — — — —

2000-2004 9 49.3 30 32.01 437 39.66 (S/) $22.16 — —

2005-2009 17 27.79 10 39.61 498 39.01 8 26.34 — —

2010-2014 23 28.44 15 27.95 442 39.71 (S/) 32.87 — —

2015-2019 41 30.5 (S/) 22.48 288 40.71 (S/) 37.88 — —

Total 114 31.37 589 37.06 2,505 40.27 19 30.88 (S/) 33.97

Table 6.—Number of Families with Benefit Entitlements Receiving the Special Minimum PIA, by the Eligibility Year of the 

Worker and the Basis for the Support PIA, as of May 2020

Year of

worker’s

eligibility

Basis for the support PIA

Total

Average

monthly

wage

(Eligibility

before

1979)

Average

indexed

monthly

earnings

(AIME)

AIME

with

windfall

elimination 

provision Others1

Pre-1979 — (S/) (S/) 48 54

1979 — 25 — 9 34

1980 — 75 — 6 81

1981 — 249 — (S/) (S/)
7

The diminishing effect of the special minimum is even

more obvious from table 6; in later eligibility years the

special minimum never exceeds the regular AIME PIA

and exceeds the Windfall Elimination Provision (WEP)

PIA relatively infrequently. Even though it was theoretically possible for a family with a year of first eligibility

from 1999 to 2016 and 2018 to 2019 and a PIA based on

the AIME to receive a special minimum PIA, the probability of such a family receiving a special minimum PIA

was very small. The worker in such a family would have

to have had earnings for at least 27 years that were no

lower than but not much higher than 25% of the “old

law” contribution and benefit base for years 1950 to

1990 and 15% of the “old law” contribution and benefit

1982 — 458 (S/) 6 (S/)

1983 — 497 (S/) 19 (S/)

1984 — 509 (S/) 15 (S/)

1985 — 588 7 31 626

1986 — 502 30 48 580

1987 — 418 45 28 491

1988 — 576 216 45 837

1989 — 412 314 35 761

1990 — 340 447 29 816

1991 — 350 456 (S/) (S/)

1992 — 146 367 — 513

1993 — 60 412 — 472

1994 — 18 315 — 333

1995 — 45 338 — 383

1996 — 44 398 — 442

1997 — 28 437 — 465

1998 — 8 480 — 488

1999 — (S/) 421 — (S/)

2000 — — 441 — 441

2001 — — 449 — 449

2002 — — 430 — 430

2003 — — 441 — 441

2004 — — 597 — 597

2005 — (S/) 603 — (S/)

2006 — — 620 — 620

2007 — — 625 — 625

2008 — — 719 — 719

2009 — — 852 — 852

2010 — — 639 — 639

2011 — — 668 — 668

2012 — — 597 — 597

2013 — — 556 — 556

2014 — — 405 — 405

2015 — — 401 — 401

2016 — — 163 — 163

2017 — — 109 — 109

2018 — — 91 — 91

2019 — (S/) 50 — (S/)

— — Total 0 5,356 14,145 324 19,825

1 Includes 1990 Old-start PIAs, 1990 New-start PIAs, Old-start guarantee PIAs, New-start guarantee 

PIAs, and Frozen minimum PIAs.

S: Data suppressed to avoid disclosing information about specific individuals.

Table 6.—Number of Families with Benefit Entitlements Receiving the Special Minimum PIA, by the Eligibility Year of the 

Worker and the Basis for the Support PIA, as of May 2020
8

base for years after 1990. The very few beneficiaries

with a PIA based on the AIME who did receive a special

minimum PIA after 1998 were all aged widow(er)’s in

which the primary had turned 62 before 1999.

The only other recipients of the special minimum in

recent years are workers who are also receiving a pension based on work not covered by the Social Security

program and their dependents and would have otherwise

received the WEP PIA, which is also based on indexed

earnings but pays a less generous PIA than the regular

formula.

The following table provides information on the number

of years of coverage for families receiving the special

minimum PIA in December 2019:

Conclusion

For first eligible beneficiaries in recent years, the probability is very small that a record of covered earnings will

yield a higher special minimum PIA than a regular

wage-indexed PIA, and, in fact, there are no recent eligible worker beneficiaries with a special minimum PIA

except those affected by the WEP, and there are relatively few of them. Projections indicate that only under

very limited circumstances will one be able to benefit

from the special minimum now and in the future,

namely those beneficiaries already receiving a special

minimum PIA and worker beneficiaries affected by the

WEP who will turn 62.

The minimum covered earnings that qualify for a year of

coverage were dropped in 1991 from 25% to 15% of the

“old-law” contribution and benefit base to give more

people the opportunity to receive the special minimum.

However, as we observed from the MBR records, the

number of people who received the special minimum

continued to drop even for people with eligibility years

after 1990.

Table 7.—Number of Families Receiving the Special 

Minimum PIA in December 2019, by Number of 

Years of Coverage and December 2019

Special Minimum PIA, as of May 2020

Years of 

coverage

December 2019 Special 

Minimum PIA Number of Families

11 $42.50 (S/)

12 86.90 (S/)

13 131.40 (S/)

14 175.70 50

15 219.70 92

16 264.40 120

17 308.80 198

18 353.20 324

19 397.60 432

20 442.20 632

21 486.60 744

22 530.70 947

23 575.90 1,130

24 620.20 1,354

25 664.20 1,459

26 709.40 1,422

27 753.20 1,575

28 797.60 1,550

29 842.10 1,695

30 886.40 6,089

Total 719.761

1 Weighted average.

S: Data suppressed to avoid disclosing information about specific

individuals.

19,825