Although Social Security has a lot of rules for retirees to follow, the program is more flexible than one might think. For example, there’s no single preset age to sign up for Social Security. Once you turn 62, you can claim benefits at any time — though your filing age will have an impact on the amount of money you collect each month.
Social Security is also flexible in that it allows recipients to collect benefits even if they’re still working. But there are rules to follow in that scenario. And if you’re not careful, you could end up in a situation where you aren’t able to collect a Social Security check at all.
Be mindful of Social Security’s earnings-test limits
Once you reach full retirement age (FRA) for Social Security purposes, you’re entitled to your complete monthly benefit without a reduction. You’re also allowed to earn as much money as you want from a job without having a negative impact on your monthly Social Security benefits.
But many seniors sign up for Social Security before reaching FRA. If you do the same, not only will you typically reduce your monthly benefit for life, but you’ll be forced to limit your earnings or otherwise risk having some — or even all — of your Social Security payments withheld.
Each year, the Social Security Administration sets a threshold known as the earnings-test limits that determines how much you can earn from a job before having benefits withheld. In 2025, that limit is $23,400. If you go beyond that limit, you’ll have $1 in Social Security withheld per $2 of income.
The earnings-test limit is much higher, though, if you’ll be reaching FRA during the 2025 calendar year. In that case, it’s $62,160. And if you exceed that limit, you’ll have $1 in Social Security withheld per $3 of income, not $2.
What this means, though, is that if you earn enough money from a job and you’re on Social Security prior to your FRA, you could end up in a situation where your monthly benefit is whittled down to nothing. So it’s important to be mindful of the earnings-test limits and pay attention to how they change from year to year.
If you’re still working, you may want to rethink an early filing
Some people claim Social Security prior to FRA even though they’re still working because they want the money to do things like travel or fix up their homes. But if you’re still working prior to FRA, you may want to reconsider claiming Social Security early — especially if you think you’ll be at risk of having benefits withheld.
When you claim Social Security early, you face a reduction in benefits. But that reduction probably isn’t worth it if you’re hardly going to get any money due to exceeding the earnings-test limit.
To be clear, withheld benefits under the earnings-test limit are repaid to you once FRA arrives. So that money isn’t lost forever.
But when you claim Social Security early, the lower benefit you lock in as a result typically does stay in place forever. So it’s important to be strategic about your filing and reconsider an early claim when you’re still earning a fair amount of money from a job.
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