Why does working reduce your Social Security benefits?
Working while collecting Social Security before full retirement age can trigger a reduction in benefits once earnings exceed annual limits, which are calculated on a monthly basis. This means higher earnings can lead to steep benefit cuts, making it feel like working is penalized at a certain point.
What people tried
Every workaround mentioned in the threads below. We haven’t tested any of them — and nobody here is claiming they worked.
- 1delaying social security until reaching full retirement age to avoid penalties
- 2starting social security benefits early at 62 despite reductions to use the money for living expenses or travel
- 3waiting until full retirement age (67) to claim benefits so earnings limits do not apply
- 4delaying the start of Social Security claims until after finishing work to avoid benefit reductions
In their words
Unedited, grouped by where they were said, most upvoted first within each place, each linked to the thread it came from.
“I was telling my dad to go and get himself social security money but he went into this office and was advised after $22,000 of his earned income there would be a deduction in how much he receives.”source ↗
“Yes the more he earns the less SS he receives, and it does feel like working for nothing at a certain point.”source ↗
“If you are younger than full retirement age 65/67 you will receive reduced SS benefit based on your income”source ↗
“The Social Security earnings limits, while expressed as an annual limit, are actually applied as a *monthly* limit of $24,600 divided by 12.”source ↗
“It's really frustrating because the internet does not seem to be able to answer this question; I only know it because I retired in August of 2024, and I've lived it.”source ↗
Where this came up
People with this problem also raised
- 4Should I file a homeowner's insurance claim or pay out of pocket?
- 3How does a short 10-year work history affect Social Security?
- 6Why bother with an HSA when you have no employer match and high premiums?
- 17Should I lower my retirement contributions to save for a house?
- 5How to decide if I'm too sick for work
- 17Is giving up a secure pension job worth it?