Claimed Social Security but Still Working? Here Is the 1 Rule You Need to Understand.
Key Points
You can claim Social Security at any time as long as you're at least 62 years old.
Earning over a certain amount while claiming benefits early will reduce your monthly benefit.
Withheld benefits are gradually added back to your benefit once you reach full retirement age.
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Although Social Security is associated with retirees, not all Social Security recipients are retired. Many recipients choose to continue working and earning money even after claiming Social Security. Some do it to keep themselves busy, while others, unfortunately, do it to earn extra income to make ends meet.
In either case, there's nothing stopping anyone from doing so, as long as they're at least 62 years old. However, if you find yourself claiming Social Security before your full retirement age, there is one Social Security rule you should know to avoid an unexpected benefit change.
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The Social Security retirement earnings test
Claiming benefits before your full retirement age and earning over a certain amount will subject you to Social Security's retirement earnings test (RET). The idea is that if you haven't lost much employment income, then you don't need the "crutch" of Social Security.
If you won't reach your full retirement age in 2026, the earnings limit is $24,480, up from $23,400 in 2025. Earning above that amount will reduce your benefits by $1 for every $2 you earn over it. For example, if you were to earn $44,480, your benefit would be reduced by $10,000.
If you hit your full retirement age in 2026, the limit is $65,160, up from $62,160. Earning above that amount will reduce your benefits by $1 for every $3 over that amount. In this case, if you earned $12,000 over the limit, your benefit would be reduced by $4,000.
These thresholds are based on changes in the national average wage index, so they typically increase every year. The only time they remained unchanged was from 2009 to 2011 after the Great Recession.
Your benefits aren't permanently lost
The silver lining is that your reduced benefit isn't gone for good; it's essentially withheld until you reach your full retirement age. Once you reach that age, your monthly benefit will be recalculated to gradually return the withheld benefits.
Of course, nobody can predict when someone will pass away, but according to the Social Security Administration, a RET-affected beneficiary will receive most or all of their withheld benefit over their lifespan.
For some people, having some benefits withheld is worth the money they're making, and they have an "I'll just get it later" mindset. Ideally, someone is doing it because they want to do it, not because they have to do it to make ends meet.
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