Many people believe they must stop working once they start receiving Social Security benefits, but that’s not the case. The U.S. Social Security system actually allows you to keep working while collecting benefits. This flexibility is especially useful if you want to earn extra income or stay active in your profession after reaching retirement age. However, it’s important to understand how your earnings may affect your benefits, so you can plan wisely.
If you’re under full retirement age, there are income limits to keep in mind. Earning more than these set limits could temporarily reduce the amount of your monthly Social Security check. These limits are updated yearly and vary depending on your age and how close you are to full retirement age. Knowing these numbers and how they work can help you make informed decisions about your work and income.
Even if your benefits are reduced because you earn too much, that money isn’t gone forever. The Social Security Administration (SSA) will adjust your benefits later to make up for the reductions. Also, by continuing to work, you may improve your lifetime earnings record, which can slightly increase your future payments. Staying informed, reporting your income, and understanding the rules will help you make the most of both your work and your benefits.
Can You Work and Collect Social Security at the Same Time?
Yes, you can! Contrary to a common myth, receiving Social Security benefits does not mean you have to quit your job. Whether you’re retired or not quite ready to stop working, the system is built to offer some flexibility. However, there are a few things you need to understand to avoid unexpected surprises with your payments.
How Work Income Affects Your Benefits
If you’re younger than your full retirement age—which ranges between 66 and 67 depending on your birth year—your earnings may affect your Social Security check. The SSA sets yearly income limits that determine whether part of your benefit will be withheld.
Income Limits in 2025:
| Status | Annual Limit | Reduction Rate |
|---|---|---|
| Below full retirement age | $22,320 | $1 withheld for every $2 earned over the limit |
| In the year you reach full retirement age | $59,520 | $1 withheld for every $3 earned over the limit |
| After reaching full retirement age | No limit | No reduction in benefits |
Once you hit full retirement age, you can earn as much as you like without affecting your Social Security payments.
What Happens to Withheld Benefits?
Don’t worry—any money that is withheld due to earning too much isn’t lost forever. When you reach full retirement age, the SSA will recalculate your benefits and increase your monthly payments to account for the withheld amount. Over time, this can help balance out the reduction you experienced earlier.
The Perks of Working Longer
Besides the income and staying active, working longer may also improve your benefit amount. Your Social Security payment is based on your 35 highest-earning years. If you continue to earn a good salary, those years may replace earlier, lower-earning ones—potentially increasing your monthly check.
Stay Informed and Plan Ahead
If you choose to work while collecting Social Security, it’s important to:
- Keep track of how much you’re earning.
- Report your income to the SSA.
- Monitor changes in the yearly income limits.
This will help you avoid any unexpected benefit reductions and ensure you’re making the most of your situation.
Working while receiving Social Security benefits is not only allowed—it can be a smart financial move. With the right planning and understanding of the income rules, you can enjoy both the security of benefits and the extra income from work. This approach gives you greater flexibility and financial peace of mind during your retirement years.
