year for postponement of claiming RIB. For example, if the person's full retirement age is 66 and 10 months and the PIA is $1,000, the benefit if claimed at 66 and 10 months would be $1,000 but would be $1,253 (plus any cost of living adjustment) if claimed at age 70. Earnings tests An earnings test has been part of the calculation of retirement benefits since the Social Security Act was signed in 1935. There are two earnings tests applied to beneficiaries who are under Full Retirement Age, the Annual Earnings Test (AET) and Monthly Earnings Test (MET). The Senior Citizen's Freedom to Work Act of 2000, signed into law April 7, 2000, eliminated the use of these tests for beneficiaries who have attained their Full Retirement Age. Annual earnings test The AET is used as the primary earnings test for RIB. The test applies only to earned income and has a two tier system in calculating deductions. The first tier, for those who are not reaching Full Retirement Age in the current year, reduces the benefits for the year by $1 for every full $2 the beneficiary earns over the annual exempt amount. The second tier, for those who are reaching their full retirement age, reduces the benefits for the year by $1 for every full $3 the beneficiary earns over the second tier annual exempt amount. The first tier annual exempt amount is $18,960 and the second tier annual exempt amount is $50,520 for the year 2021. When possible, all benefits deducted are deducted at the beginning of the year before any benefits are paid. The earnings test does not reduce lifetime Social Security benefits, on average. This is because any benefits lost to the earnings test lead to increased monthly benefit amounts when an individual reaches the full retirement age. For example, if an individual claims benefits at 62 in 2021 and receives $920 a month, but then returns to work for a year and has 12 months of benefits withheld, SSA would recompute the benefit at the person's full retirement age and pay $985 a month (in today's dollars) going forward. Thus, the earnings test shifts Social Security benefits from a time when a person is working to a time when they are more likely to be retired. Monthly earnings test The MET can be used only in certain years, under certain conditions. In order for