Retirement is often seen as a time for relaxation and enjoying life, but for many, it means continuing to work while receiving Social Security benefits. Whether it’s because they want to or need to, many seniors continue to earn a paycheck while collecting their Social Security. However, if you haven’t reached your full retirement age (FRA), working while receiving benefits could reduce or even pause your payments.
In 2026, Social Security’s work rules will change, potentially allowing you to earn more without losing benefits. Understanding these new thresholds is essential for planning your retirement and making the most of your benefits.
Social Security Work Rules: What They Look Like in 2025
Before we dive into the 2026 changes, let’s review how the current rules work in 2025:
| Age | Income Limit | Reduction in Benefits |
|---|---|---|
| Under FRA | $23,400 per year | Lose $1 for every $2 earned above this threshold |
| Reaching FRA in 2025 | $62,160 per year (before reaching FRA) | Lose $1 for every $3 earned above this threshold |
| At FRA or older | No income limit | No reduction in benefits after FRA is reached |
- Under Full Retirement Age (FRA): If you’re still working and collecting Social Security before reaching your FRA, you’ll lose $1 in benefits for every $2 you earn above $23,400 (for 2025). However, this is not permanent; once you reach your FRA, your monthly benefits will be recalculated to account for the missed payments.
- Reaching FRA: If you’re about to hit your FRA, you can still work, but you’ll lose $1 in benefits for every $3 earned above $62,160 until you actually reach your FRA.
Once you reach your FRA, you can earn as much as you want without affecting your Social Security payments.
Changes to Social Security Work Rules in 2026
In 2026, the thresholds for earning while collecting Social Security will increase. While the exact announcement is pending, projections suggest that:
| Income Limit (2025) | Projected Income Limit (2026) | Increase |
|---|---|---|
| $23,400 | $24,360 | $960 |
| $62,160 | $64,800 | $2,640 |
- If you won’t reach FRA in 2026, you can earn an additional $960 before your benefits start being reduced.
- If you’ll reach FRA in 2026, you can earn $2,640 more before seeing any reduction in benefits.
These increases mean you can earn more without losing any of your Social Security benefits, making it easier to balance work and income during your transition into full retirement.
Why Understanding the Rules Is Crucial for Retirement Planning?
Knowing how working while receiving Social Security affects your payments is critical to your overall retirement strategy. If you plan to work during retirement, you need to consider whether it’s worth starting your Social Security benefits early, or if waiting until your FRA might be more beneficial.
For some retirees, Social Security is a vital source of income. However, many people haven’t saved enough for retirement and need to continue earning a paycheck. In these cases, the Social Security work rules could significantly impact how much money you can take home and how it affects your retirement plans.
Here’s why understanding these rules matters:
- Budgeting for Retirement: If you expect to earn a paycheck and also collect Social Security, it’s important to factor in how much of your Social Security you might lose. If your earnings exceed the threshold, you could end up with less income than anticipated.
- Early Claiming vs. FRA: If you need to work while claiming Social Security, you might wonder if it’s worth claiming early. Understanding how the income limits affect your benefits could help you decide if it’s better to wait until your FRA, when you can work and earn freely without penalties.
- Social Security Strategy: If you’re not yet at your FRA but need extra income, knowing the exact thresholds for earning will help you plan better. If your income exceeds the limit, you could lose part of your benefits, so it’s essential to manage your earnings carefully.
Planning Your Retirement Around the Social Security Work Rules
As these rules are set to change in 2026, you’ll have more flexibility in terms of how much you can earn without affecting your benefits. Here are some things to consider when planning:
- If You Need to Work Before FRA: If you’re working and claiming Social Security benefits before reaching your FRA, make sure you understand how much you can earn before your payments are reduced. In 2026, you’ll have a bit more leeway with the higher thresholds.
- Adjust Your Savings: If you are counting on Social Security as a significant part of your income, but need to keep working, think about how your Social Security payments will interact with your earned income. You might decide to reduce withdrawals from your retirement savings to avoid relying too heavily on Social Security.
- Maximize Your Social Security: If you’re planning to wait until FRA to claim Social Security, the rules will allow you to work freely, which can help build your retirement savings further while collecting full benefits.
FAQs
What is the full retirement age (FRA)?
FRA is the age at which you can start receiving full Social Security benefits without any reductions due to work. FRA varies based on your birth year but is typically between 66 and 67.
How much can I earn before my Social Security benefits are reduced?
In 2025, you can earn up to $23,400 before losing benefits. If you reach FRA in 2025, the threshold increases to $62,160. In 2026, these thresholds will increase to $24,360 and $64,800, respectively.
What happens if I earn more than the threshold?
If you earn more than the limit, Social Security will reduce your benefits. For every dollar you earn above the threshold, you’ll lose a portion of your benefits, but those lost benefits are typically added back once you reach FRA.
When can I work without affecting my benefits?
Once you reach your FRA, you can work as much as you want without any reduction in your Social Security benefits.
Is it better to claim Social Security before FRA or wait until I reach FRA?
If you need to work and earn money, you may want to wait until your FRA to claim Social Security to avoid reductions. However, if you need the income sooner, you can claim early, but you should be mindful of the income limits.