The Social Security earnings test deducts $1 for every $2 earned above $24,480, a limit most full-time workers earning roughly $64,000 annually easily blow past.
Claiming at 62 permanently cuts benefits up to 30%, and earning $50,000 on top eliminates over eight months of annual benefit checks through withholding.
Withheld benefits are repaid at full retirement age through a higher monthly check, but the lasting cost is lost cash-flow flexibility during working years.
Are you ahead, or behind on retirement? SmartAsset's free tool can match you with a financial advisor in minutes to help you answer that today. Each advisor has been carefully vetted, and must act in your best interests. Don't waste another minute; learn more here.
Roughly one in eight retirees still claims Social Security at 62, and many of them keep working. That combination triggers a rule most people learn about only after the money is already gone. For 2026, the Social Security Administration deducts $1 in benefits for every $2 earned above $24,480 for anyone under full retirement age for the entire year. The check shrinks, sometimes to nothing, and the recipient often does not see the mechanics until the withholding notice arrives.
The number matters because it sits well below what most full-time workers earn. Median usual weekly earnings for full-time wage and salary workers hit $1,235 in the first quarter of 2026, which, annualized, amounts to roughly $64,000. Average hourly earnings across the private sector reached $37.64 in June 2026. A 62-year-old working even 30 hours a week at that rate blows past the $24,480 limit before autumn. Every dollar earned beyond that threshold pulls 50 cents from the monthly benefit.
_________________________________
Here's a question most people 5y from retirement can't answer: at your current savings rate, how much do you need, and how long will it actually last? A good advisor can put a date on that in a single meeting. SmartAsset's free quiz matches you with up to three fiduciary advisors serving your area, so you can get YOUR retirement number now (sponsor)
__________________________________________
Claiming at 62 already carries a permanent haircut. A worker whose full retirement age is 67 accepts up to a 30% reduction in the monthly benefit for the rest of their life. The average retired worker who filed at 62 receives about $1,424 per month, well below the average check of roughly $2,083 for all retired workers. Layer the earnings test on top, and the math turns punishing quickly.
Source: Yahoo Finance Top News — This article was automatically imported from the source. Read full article at original source →
