AARP Hearing Center
Alice Mollon
Key takeaways
- You could temporarily lose your benefit if you earn too much.
- Above an income limit, money is deducted from your check.
- Here’s how your monthly payment could be affected.
- Earnings test is different in year you reach full retirement age.
- You’ll get that ‘lost’ money back, but gradually.
Working and getting a Social Security retirement benefit every month sounds like a great idea, right?
Maybe not. If you apply for Social Security before reaching full retirement age and continue working or file and then go back to work, you could temporarily lose some of your monthly benefit depending on how much you earn.
If you do lose some of your benefit, you will get the money back, but not in a lump sum. You’ll get it back little by little every month after you reach full retirement age.
If you’re 62 this year — or for anyone born in 1960 and later — your full retirement age is 67. And if you choose to apply for Social Security before your full retirement age:
- Your retirement benefit will be reduced by as much as 30 percent, permanently.
- Your work income will be put to the test — specifically, the Social Security retirement earnings test
Video: Can I Collect Social Security While I'm Working?
Why the government has an earnings test
The earnings test is a legacy of Social Security’s initial goal to provide a guaranteed income for older adults who have retired from work. If you can still work, you’re not really retired, the thinking goes.
The test is less stringent than in the past. It used to apply until age 70 but now ends at full retirement age.
If you’re younger than full retirement age and your earnings from work exceed $23,400 in 2025, the Social Security Administration (SSA) will withhold $1 from your benefit payment for every $2 in earnings above the limit.
If you work and collect Social Security before full retirement age, the money you expect could be delayed.
Exceed the level by enough, and your entire benefit could be withheld.
If you work for someone else, your gross wages count toward the earnings test. If you’re self-employed, your net earnings will be used.
Earnings include bonuses, commissions and vacation pay, SSA says. What doesn’t count: annuities, interest, investment income, pensions, and government or military retirement benefits.
Join our fight to protect Social Security
You’ve worked hard and paid into Social Security with every paycheck. Here’s what you can do to help keep Social Security strong:
- Add your name and pledge to protect Social Security.
- Find out how AARP is fighting to keep Social Security strong.
- Get expert advice on Social Security benefits and answers to common questions.
- AARP is your fierce defender on the issues that matter to people 50-plus. Become a member or renew your membership today.
Doing the math on your money is important
Here’s the way the earnings test works: Let’s say you turned 62 in December 2024. You’re earning the U.S. median income — $1,196 a week, or $62,192 a year — but you’re considering starting Social Security to bring in a little more.
Let’s also say you would qualify for the average Social Security retirement benefit — $2,005 a month as of June 2025 — if you had waited to collect until age 67, your full retirement age. If you take the 30 percent cut to start collecting in January, your benefit will be $1,403.50 a month, $16,842 a year.
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