Tips on deciphering Social Security lingo

Is Social Security a topic in your conversations these days? Are you familiar with the lingo used to describe Social Security benefits or does it sound like a new vocabulary to you?

Social Security employees strive to explain benefits using easy-to-understand, plain language. But if a technical term or acronym you don’t know slips into the conversation or appears in written material, you can easily find the meaning online at socialsecurity.gov/ agency/glossary.

Social Security acronyms function as verbal shorthand in financial planning conversations. If you’re nearing retirement, you may want to know what PIA (primary insurance amount), FRA (full retirement age) and DRCs (delayed retirement credits) mean. These terms involve your benefit amount based on when you decide to take it.

If you take your retirement benefit at FRA, you’ll receive the full PIA (amount payable for a retired worker who starts benefits at full retirement age). So, FRA is an age and PIA is an amount.

What about DRCs? Delayed retirement credits are the incremental increases added to the PIA if you delay taking retirement benefits beyond your full retirement age. If you wait to begin benefits beyond FRA — say, at age 68 or even 70 — your benefit increases.

Once you receive benefits, you get a COLA most years. But don’t expect a refreshing drink — a COLA is a Cost of Living Adjustment, and that will usually mean a little extra money in your monthly payment.