What’s the Cutoff for Social Security Earnings, and What Does It Mean for Your Retirement?
Written by
Allison Hache
Edited by
Molly Sullivan
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Collecting Social Security doesn’t mean you have to stop working — but how much you earn can affect your benefits. If you’re below full retirement age (FRA), there’s a limit to what you can make before your monthly payments take a hit.
Understanding these limits can help you balance work and retirement income without surprises.
Earnings Limits for 2025: What’s Changed?
The earnings limit for 2025 is $23,400 if you have not reached FRA, and $62,160 the year you do. This is an increase from the 2024 limits of $22,320 and $59,520, respectively. Once you are at full retirement age, there is no limit.
How Much Can You Earn Before Benefits Are Reduced?
If you’re under FRA — 66 or 67, depending on when you were born — earning more than the earnings cutoff means your benefits could be temporarily reduced. But don’t worry. Once you’ve hit FRA, you’ll receive a recalculated benefit that accounts for any withheld payments.
If You’re Under Full Retirement Age
You can earn up to $23,400 in 2025 without any reduction in benefits. If you exceed that amount, $1 will be deducted for every $2 earned over the limit.
For example, let’s say you’re 63 years old and receiving Social Security benefits, but you decide to take on a part-time job that pays $28,400 for the year. Since the earnings limit for 2025 is $23,400, you’re $5,000 over the limit. You’ll lose $2,500 from your benefits that year. If your monthly Social Security check is $1,500, you’ll temporarily lose a little less than two months of payments that year.
If You Reach Full Retirement Age in 2025
If you will reach full retirement age in 2025, the $62,160 earnings limit applies to the money you earn before your birthday, with $1 deducted for every $3 over the limit. Beginning the month you become full retirement age, the Social Security Administration will recalculate your benefits to adjust for the reductions from earlier months.
Here’s how it works if you turn 67 in September 2025 and reach full retirement age and keep working. If your salary before your birthday is $70,160, you lose $2,667 in benefits — about one month of payments if your monthly benefit is $2,500. The key difference here is that starting in September — when you reach FRA — you can earn as much as you want with no benefit reductions.
How These Limits Affect Your Retirement Strategy
Working while collecting Social Security can be a smart financial move, but you need to plan for temporary benefit reductions if you’re under FRA and earn above the 2025 limit. Ask yourself the following if you’re considering working during retirement:
- Do you need extra income? If Social Security alone isn’t enough to cover expenses, working might be necessary.
- Can you afford a temporary reduction? If you’re under FRA and earning over the limit, prepare for lower monthly payments.
- Are taxes a factor? If your total income (including Social Security) is high, up to 85% of your benefits could be taxed.
- Would delaying benefits be smarter? Waiting until FRA or later to claim Social Security means you can earn as much as you want with no reductions. You should also notice a boost to your monthly check if you wait until age 70 to start claiming benefits.
If you plan to work while collecting Social Security, be strategic. Stay under the earnings limit to avoid temporary reductions or budget accordingly if you’re going to exceed it. If you don’t need benefits yet, delaying your claim can increase your monthly payout for life. The key is understanding the rules so you can make informed choices that support your long-term financial security.
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