Retirement

How the Rules Work for You

July 12, 2018 • By

Last Updated: July 12, 2018

Retirement doesn’t have the same meaning for everyone. Some people plan to retire and never work again. Some people plan for second careers in occupations that wouldn’t have adequately supported their families, but they do the work for pure enjoyment. Some people, whether by design or desire, choose to work part-time or seasonally to supplement their retirement income.

Retirees (or survivors) who choose to receive Social Security benefits before they reach full retirement age (FRA) and continue to work have an earnings limit. In 2017, the annual earnings limit was $16,920 for those under FRA the entire calendar year. In 2018, it is $17,040. If you earn over the limit, we deduct $1 from your Social Security monthly benefit payment for every $2 you earn above the annual limit. 

In the calendar year you reach FRA, which you can check out on our website, you have a higher earnings limit. Additionally, we will only count earnings for the months prior to FRA. In 2017, the limit was $44,880. In 2018, it is $45,360. In the year of FRA attainment, Social Security deducts $1 in benefits for every $3 you earn above the limit.

There is a special rule that usually only applies in your first year of receiving retirement benefits. If you earn more than the annual earnings limit, you may still receive a full Social Security payment for each month you earn less than a monthly limit. In 2018, the monthly limit is $1,420 for those who are below FRA the entire calendar year. The 2018 monthly limit increases to $3,780 in the year of FRA attainment.

Once you reach FRA, you no longer have an earnings limit, and we may recalculate your benefit to credit you for any months we withheld your benefits due to excess earnings. This is because your monthly benefit amount is calculated based on a reduction for each month you receive it before your FRA. So, if you originally filed for benefits 12 months before your FRA, but earned over the limit and had two months of Social Security benefits withheld, we will adjust your ongoing monthly benefit amount to reflect that you received 10 months of benefits before your FRA, and not 12.

Most people understand that if they work while receiving benefits before FRA, their benefit may be reduced. What most people do not consider in their retirement planning is that we recalculate your Social Security monthly benefit at FRA to credit you for Social Security benefit payments withheld due to earnings over the limit. Explaining the earnings limit is another way that Social Security helps secure your today and tomorrow. Understanding both the earnings limit and the possible recalculation of your ongoing Social Security benefits will provide an additional perspective on retirement for you to consider.


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About the Author

Jim Borland, Acting Deputy Commissioner for Communications

Comments

  1. Harold J.

    I’m 62 now and working, I will not make $17,040 the remainder of the year. Can I get benefits and not be penalize for my earnings.

    • Ray F.

      Great question, Harold. If your earnings will be over the limit for the year but you will be retired for part of the year, we have a special rule that applies to earnings for that one year.
      If you’re under full retirement age, you are considered retired in any month that your earnings are $1,420 or less and you did not perform substantial services in self employment.
      Please visit our Retirement Planner: Getting Benefits While Working and read our publication How Works Affect Your Benefits for more information.
      Thanks!

    • Ray F.

      Great question, Harold. If your earnings will be over the limit for the year but you will be retired for part of the year, we have a special rule that applies to earnings for that one year.
      If you’re under full retirement age, you are considered retired in any month that your earnings are $1,420 or less and you did not perform substantial services in self employment.
      Please visit our Retirement Planner: Getting Benefits While Working and read our publication How Works Affect Your Benefits for more information.
      Thanks!

  2. SARTHAJ V.

    Hi hello I’m looking for social security card I’m not a US person I having US Visa older in my passport can I get social security card number

  3. Brandy r.

    In 2018 I have been waiting on all my payment just started recivinung my disability in May on the 28 so how can u even count 2018 n base my pay off of that when I’m sick n dying I new life it should be counted for working my whole life…so I dont get how u r basing my earning in 2018 when knowly I can’t work ..? When I app.she said I earned enough to apply for everything n retirements of being the I put enough inn and the judge approved all in my favor 3 years of stress n I only get 703.00 a month i know I put enough inn the actual refunds owed to me…can we get me a copy of the actual application for everything n retirements of the actual application I applied for this is the only thing that has been struggling to me by ssi and also using the unclaimed money for a few minutes to get to my payments and the payment I should be reviving n I am not. Why if I made enough when I worked I am intitled to the actual refunds owed to me smh.

  4. Regina

    This was very informative. Thank you.

    • Bobby K.

      I am disabled getting ssdi and last time and time before at the s.s. office I was told when I turn retirement age I will get both disability and I also worked enough to get ss benefits and continue my ssdi benefits. It has been told iot is true and is a blessing since getting by on minimum is hard. It’s so hsrd to believe I will have some years left God willing to live a little better. Still hard to believe but have been told yes by 2 agents and downstate office.

  5. VYoung

    Very good information for those of us over 65 and still working.
    Thank you for keeping us informed.

    • Ray F.

      Thank you! We’re pleased we can help. We will continue our efforts to meet your requirements and expectations in the years to come.

  6. Jacqueline D.

    I think I qualify for the low income benefits for SSI, when I filled out the eligibility form it stated I was qualified for it. I know people that are getting both. I am tired of being lied to and I will have to get an attorney and fight for my money.

    • Snarky

      Fine, get an attorney and blow your limited income. If your SS or other income is lower than the SSI threshold then you could get both but the SSI is reduced dollar for dollar by other unearned income after the first $20.00. Put the paranoia pills away, no one is lying to you.

    • Ray F.

      Hello Jacqueline. Yes, there are times when people can receive both, their regular (disability or retirement) Social Security benefits and SSI benefits. It depends on their situation and whether they meet specific requirements.
      The Supplemental Security Income (SSI) program is a needs-based program that pays benefits to disabled adults and children who have limited income and resources. SSI benefits are also payable to people 65 and older without disabilities who meet the financial limits. If you have low income and limited resources, you may be eligible to receive both benefits.
      Please call us at 1-800-772-1213 (TTY 1-800-325-0778) and speak tone of our agents. Representatives are available Monday through Friday, between 7 a.m. to 7 p.m. Or contact your local Social Security office directly.
      Thanks!

  7. Gary H.

    Why does there need to be a limit on income when drawing my SS benefits prior to reaching the FRA? It is my money that I paid in over the last 40 some years. You are already reducing my benefits because of starting early so why put a second limit on it???

    • Snarky

      SS retirement was always meant to replace lost retirement income. If you are not retired why do you expect payment? You pay into insurance too, would you expect payment if you suffered no loss?

    • Tom

      It is actually not your money as you have no private account. That seems to be the basis of your misunderstanding.

      You are getting a social insurance payment against the loss of your working income. It is the same as term insurance. There is no private dividend, just a big pot of contributions pooled together for when you (and anyone else) are disabled, retired or die and have eligible survivors. Your benefits don’t stop either when your contributions run out like under an individual account.

      Congress determines the age of eligibility for benefits and when deductions apply for work. If you are under your FRA (full retirement age), deductions could apply. The FRA is the point where you can earn what you want with no deductions. That point of unlimited earnings with no deductions used to be age 72, then 70 and then 65. It has been tied to the FRA for decades now.

      In short, if you earn over the allowable amount of earnings, you cannot be insured in full unless you are past your FRA. Just like you cannot claim under your auto policy unless your car is damaged or under your health plan unless you receive treatment. That is why your application said “Retirement Insurance Benefits”.

  8. Rev C.

    Working for the Good Lord in retirement gives peace of mind that God is gonna take care of you in Retirement. Making more money siimply means you wanna spend more money rather than living below your means. The Bible teaches us that “The Lord is my shepherd & I shall not want, yes?

  9. David a.

    Hi this is Sonia I need appt ssa too SSDI when interpreter time pls mail me ok. Thanks

    • Snarky

      SS will supply you with an interpreter if you need one. Make them aware of that before your appointment. You can not request assistance on this public blog.

    • Ray F.

      Hello Sonia. We provide free interpreter services to help you conduct your Social Security business. These interpreter services are available whether you talk to us by phone or in the Social Security office.
      Please call our toll free number at 1-800-772-1213 and one of our agents will assist you. Representatives are available Monday through Friday, between 7 a.m. and 7 p.m.
      Thanks!

    • Teresa M.

      I was wanted to know if I get a part time job how much can I make a month

  10. David S.

    I have been in SS for some time now and have been told I might not have had my SS Retirement figured properly, how can this be checked out?

    • Snarky

      Ignore the comment if you were told this by a s**t house lawyer who is clueless. Otherwise you can request a recalculation of your benefits by contacting (obviously) Social Security.

      • Ruth F.

        I was awarded disability that went back 1 year. They told me I had to be deemed disabled by the SSA for 5 full months to get a payment. I was approved and only got 6 months not the year I was told. SSA approved to jan 2019. They only back paid June thru December. I found all this out when I got my back pay. Why do we have a 5 month waiting period? I haven’t had a real income since 2017. Thank you

        • Vonda V.

          Hi Ruth. Current law requires everybody that is approved for disability benefits under the Social Security Disability Insurance (SSDI) program to serve a 5 month waiting period. The 5 month waiting period ensures that during the early months of disability, we do not pay benefits to persons who do not have long-term disabilities.

    • Ray F.

      Hello David. You can ask for a review of your benefit records. You may contact your local Social Security office directly or you can write to us or send us an email message. Thanks.

Comments are closed.