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Working in Retirement

Can I work while collecting social security?

Handsome businessman with eyeglasses working from home

Ah, retirement! It’s the stage of life that almost everyone is waiting for. If you’ve reached retirement age, you may be ready to begin collecting social security benefits. At the same time, you might be thinking of pursuing a part-time job or even a second career after you retire. 

Can you do both? Are you permitted to work while collecting social security benefits? The short answer is, “yes,” but there are a few considerations.

Have you reached ‘full retirement age?’

In the U.S., there is a “full retirement age;” the age at which you can begin collecting full social security benefits. The age varies depending on when you were born. If you were born in 1937, you will reach full retirement age at age 65. For those born from 1943-1954, the full retirement age is 66. From 1955 onward, you add two months per year to your full retirement age. 

For example, if you were born in 1955, you would add one year and two months to your retirement age, meaning you could retire and collect full social security benefits at age 66 and 2 months. The addition stops in 1960. Anyone born in 1960 or after can collect full benefits beginning at age 67.

If You Started Collecting Early...

You can start collecting social security when you turn 62, regardless of what your full retirement age is. If you start collecting at this age, your payments will be reduced, and they will not increase when you reach full retirement age.

Working in Retirement

Can you work while collecting early social security benefits? Yes, but there are limits. You can earn up to $17,640 per year ($1,470/month). If you earn more than that, your social security payment will be reduced by $1 for every $2 you earn. Say, for example, you work part-time in retirement at age 63 and bring in $20,000 per year. That's an excess of $2360 over the limit, which means your social security payments will be decreased by $1180.

If You Wait Until Full Retirement Age...

If you do not start collecting social security until you reach full retirement age, the restrictions on working in retirement are more lenient. You can earn up to $46,920 per year while still collecting full social security. If you earn more than this, your social security payment will be reduced by $1 for every $3 you earn in excess of the limit.

If you are someone who begins collecting social security early, your income limit will automatically increase to the $46,920 threshold when you do reach full retirement age — but the amount of social security you earn will not change. 

Should You Consider Working in Retirement?

If you have the drive to continue working in retirement, social security restrictions should not stand in your way. The $46,920 limit is fairly generous — few part-time jobs would pay more than this, and you can even work full-time in some fields. Even if you start collecting early, you can earn up to $17,640 per year without reducing your social security payments, which is still enough to positively impact your lifestyle.

Working in retirement is not for everyone, but social security regulations are written to allow for this possibility. 

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