How Much Can I Make and Still Collect Social Security?
Discover how working impacts your Social Security benefits. Get clear insights into earning income while collecting payments.
Navigating Social Security benefits while continuing to work raises questions about how earnings influence monthly payments. Understanding Social Security Administration (SSA) regulations is important for current and future beneficiaries. Rules govern how much earned income affects Social Security benefits, ensuring beneficiaries understand the financial implications of their work.
Social Security Earning Limits Explained
Social Security earning limits apply to individuals receiving retirement benefits who have not yet reached their Full Retirement Age (FRA). It is important to distinguish “earned income” from other forms of income, as only earned income counts toward these limits. Earned income includes wages, salaries, bonuses, commissions, vacation pay, and net earnings from self-employment. Conversely, “unearned income” such as pensions, annuities, investment income, capital gains, and government retirement benefits do not count against the Social Security earnings limits.
The Social Security Administration establishes annual earning limits. For 2025, there are two distinct earning limits that apply to beneficiaries working before their Full Retirement Age.
Under Full Retirement Age for the Entire Year
The first limit applies to those who will be under their Full Retirement Age for the entire calendar year. For these individuals, the annual earnings limit is $23,400 in 2025.
Reaching Full Retirement Age Within the Year
A separate, higher earning limit applies to beneficiaries who will reach their Full Retirement Age within the current year. In 2025, this limit is $62,160. This higher limit applies only to earnings received in the months leading up to the beneficiary’s Full Retirement Age. Once an individual reaches their Full Retirement Age within that year, the earnings limit no longer applies to their income from that point forward.
How Benefits Are Affected by Exceeding Limits
When a Social Security beneficiary exceeds the applicable earning limit, their benefits are subject to a reduction, not a tax. The specific withholding formula depends on whether the individual is under Full Retirement Age for the entire year or is in the year they reach Full Retirement Age. The Social Security Administration withholds benefits by stopping monthly payments until the required reduction amount is met.
Under Full Retirement Age for the Entire Year
For beneficiaries who remain under their Full Retirement Age for the entire year, the Social Security Administration withholds $1 in benefits for every $2 earned above the annual limit. For example, if a person earns $2,000 over the 2025 limit of $23,400, their benefits would be reduced by $1,000. This reduction continues until earnings fall below the threshold or the individual reaches their Full Retirement Age.
Reaching Full Retirement Age Within the Year
For those who will reach their Full Retirement Age during the year, a different withholding rule applies. For earnings made in the months before reaching Full Retirement Age, the SSA withholds $1 in benefits for every $3 earned above a higher annual limit, which is $62,160 in 2025. This specific rule only considers earnings up to the month before the individual’s Full Retirement Age. Once the beneficiary attains their Full Retirement Age, earnings from that month onward no longer result in benefit reductions.
Earning Beyond Full Retirement Age
Upon reaching Full Retirement Age (FRA), a significant change occurs regarding Social Security benefits and earned income. Full Retirement Age is the specific age at which an individual becomes eligible to receive 100% of their primary Social Security benefit amount, without any reductions for early claiming. For individuals born in 1960 or later, the Full Retirement Age is 67.
Once a Social Security beneficiary reaches their Full Retirement Age, the earning limits no longer apply. This means individuals can earn any amount of income from work without their Social Security benefits being reduced or withheld.
Any benefits that may have been withheld due to earnings exceeding limits before Full Retirement Age are not permanently lost. Instead, the Social Security Administration recalculates the benefit amount once the individual reaches their Full Retirement Age. This recalculation provides credit for the months in which benefits were reduced or withheld, leading to a slightly higher monthly payment in the future.
Additionally, delaying the start of Social Security benefits past Full Retirement Age, up to age 70, can result in increased monthly payments through Delayed Retirement Credits. These credits increase the benefit amount by a certain percentage for each month benefits are delayed, providing an incentive for those who can afford to wait.