SS

The amount of social security you receive is based on your earnings that are indexed and that figure is call the average indexed monthly earnings (AIME). For example if your earnings in 1995 were $23,901, the average for that year, you would multiply that by the index factor for that year which was 2.5822 and do that for each year you worked. Then add up all the index adjusted values for each year you worked for the 40 years between ages 22 and 62, then subject the lowest five years and divide the result by 35 and that will the benefit you receive full retirement age. Trump has proposed not taxing social security benefits but that needs to be tweaked. Social security benefits are already designed to help low income earners. It can easily be used to narrow the wealth gap. First off all benefits would be tax free but would be reduced by other income. For example if any person has $100,000 of income including social security their benefit should be reduced by ten percent for each additional $10,000 of income so when their total income is $200,000 their SS benefit is zero. Another big way to close the income gap is to reduce the cost of SS for incomes below $100,000 which is currently set at 6.2% of pay. If that were reduced o 4.2% it would mean a $1,000 raise for anyone earning $50,000 per year. In order to make sure their retirement benefit is not reduced the index factors would be adjusted accordingly. Thus people earning less that $100,000 would pay in less but still receive the full benefit.