Working and Claiming Social Security at 62? 2 Things That Could Happen.

Claiming Social Security while you continue to work seems like a surefire way to increase your monthly income and maybe improve your standard of living. But the reality is, it can make your finances more complicated.

There are two little-known Social Security rules that could leave you with less than you'd anticipated. Here's what you need to know to decide if working and claiming benefits is the right move for you.

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1. The early claiming benefit reduction

When the Social Security Administration calculates your benefit, it first determines the amount you qualify for at your full retirement age (FRA). The government assigns this to you based on your birth year. It's 67 for most workers today.

Then, it adjusts that amount up or down depending on your age when you apply. Early claimers see their benefits shrink by up to 30%. That's enough to drop the $2,076 average monthly retirement benefit as of February 2026 to $1,453 per month.

This reduction is generally permanent, and it can lead to a lower lifetime benefit for you. That's why some people who don't need their Social Security checks while they're still working prefer to delay their application until they retire.

Every month you wait to apply increases your checks until you qualify for your maximum benefit at 70. At this point, you'll qualify for 124% of the benefit you're eligible for at your FRA of 67.

2. The earnings test

The earnings test is a Social Security rule that specifically targets early claimers who are still working. It withholds money from their checks if they earn more than a certain amount from their jobs during the year.

The earnings test thresholds change annually. In 2026, you lose $1 for every $2 you earn over $24,480 if you'll be under your FRA all year. If you'll reach your FRA in 2026, you'll only lose $1 for every $3 you earn over $65,160 if you earn this much before your birth month.

In some cases, the earnings test can wipe out entire benefit checks. However, that money isn't gone for good. When you reach your FRA, the Social Security Administration will increase your checks to make up for the amount it withheld before. However, you'll likely still wind up with less than you would have gotten had you just delayed Social Security until your FRA in the first place.

Once you reach your FRA, the earnings test no longer applies. At that point, you're free to earn as much as you'd like from your job without it directly reducing your benefits.

If either of these things concerns you, that could be a sign that waiting to claim Social Security is the better option. Putting off your application until you've retired or reached your FRA could help you squeeze more money out of the program.

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