Social Security: How You Can Work and Still Receive Benefits

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According to the Social Security Administration, you can receive retirement benefits and still work at the same time. The catch is that if you are younger than full retirement age, and earn more than certain amounts, your benefits will be reduced — but never truly lost. 

Here’s how it works.

If you decide to work and take retirement benefits, the benefit will be reduced now but then increase at your full retirement age to account for benefits withheld due to earlier earnings. The SSA notes that spouses and survivors who receive benefits because they have minor or disabled children in their care don’t receive the increased benefit at full retirement age if benefits were withheld because of work. 

If you were born between January 2, 1959, and January 1, 1960, then your full retirement age for retirement insurance benefits is 66 and 10 months. If you work and are at full retirement age or older, you may keep all of your benefits regardless of how much you earn. 

If you are younger than full retirement age, there’s a limit to how much you can earn and still receive full Social Security benefits. If you are younger than full retirement age during all of 2021, the SSA will deduct $1 from your benefit for each $2 you earn above $18,960.

If you reach full retirement age during 2021, The SSA will deduct $1 from your benefits for each $3 you earn above $50,520 until the month you reach full retirement age.

Are You Retirement Ready?

How Income Is Counted

If you work for someone else, only your wages count towards Social Security’s earnings limits. If you are self-employed, only your net earnings from self-employment are counted. 

For earnings limit, the SSA does not count income such as other government benefits, investment earnings, pensions, annuities and capital gains. 

An employee’s contribution to a pension or retirement plan is counted, but only if the contribution amount is included in the employee’s gross wages.

In general, if you work for wages, income will be counted when it is earned, not when it is paid. If you have earned income in one year, but the payment was made the following year, it’s important to note that it should not be counted as earnings for the year you receive it.

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