Social Security Choices

Claiming Benefits While You Are Working

While you're working, your benefit amount will be reduced only until you reach your full retirement, which is age 66 for those born between 1943 and 1954. If you are under full retirement age when you start getting your Social Security payments, $1 in benefits will be deducted for each $2 you earn above the annual limit.

Benefit Forfeiture Due to Working
Age Annual Income Limit Benefit Forfeiture for Income Above Limit
62 until Year of 66th Birthday Begins $15,120 $1 per $2 earned
Year of 66th Birthday $40,080 $1 per $3 earned
66 and above None N/A

The benefit reduction due to earning too much looks like a tax on earnings. That view is only partly correct. If some of your retirement benefits are withheld because of excessive earnings, your benefits will be increased starting at your full retirement age to take into account those months in which benefits were withheld. If you live into your 80s, you will generally recover everything that was initially withheld. If you live into your late-80s or 90s, you will more than recover what was withheld. So, while the benefit reduction may look like a tax on earnings, over the long run that view turns out not to be correct for many people.

The SSA provides useful information about how work affects your benefits at their pages: "How Work Affects Your Benefits", "Exempt Amounts Under the Earnings Test", and "When you work and reach full retirement age". Also, the SSA provides a retirement earnings calculator to help you determine how working will affect your benefits.

For more information about claiming benefits while working, please see our expanded page in the information section.