I Took Social Security at 62. How Much Money Can I Earn Working?

[Pelican Press 0]

This is the hidden content, please

• Sign In
• or
• Sign Up

I Took Social Security at 62. How Much Money Can I Earn Working?

Ask an Advisor: How Much Money Can I Earn Working After Taking Social Security at Age 62?

How much am I able to earn from an employer if I opt to take my Social Security at age 62 next year?

– Glenn

To be very clear, you can earn as much money as you want while collecting

This is the hidden content, please

• Sign In
• or
• Sign Up

benefits. The issue that most people are concerned with is having their benefits reduced for earning more than the annual earnings limit.

In 2023, you can earn up to $21,240 without seeing any reduction in your Social Security benefit. However, there are some important things to keep in mind when claiming Social Security before you reach full retirement age. (And if you need more help planning for Social Security,

This is the hidden content, please

• Sign In
• or
• Sign Up

)

Social Security Earnings Limit

This is the hidden content, please

• Sign In
• or
• Sign Up

Ask an Advisor: How Much Money Can I Earn Working After Taking Social Security at Age 62?

If you claim your benefit before hitting your

This is the hidden content, please

• Sign In
• or
• Sign Up

, you’ll be subject to the earnings limit. The specific amount adjusts each year, but for 2023 it’s $21,240.

If you earn more than that amount, your monthly benefit is reduced by $1 for every $2 you earn above the limit. So, if you earn $21,242, your monthly Social Security check would be $1 less than it would be otherwise. Earning less than that limit won’t affect your benefits at all.

However, things change a little bit in the calendar year in which you’ll reach your full retirement age. For people who hit their full retirement age in 2023, the earnings limit increases to $56,520. On top of that, your benefits are only reduced by $1 for every $3 you earn above the limit. (And if you need more help navigating the complexities of Social Security planning,

This is the hidden content, please

• Sign In
• or
• Sign Up

.)

Here’s what you should know about the earnings limit:

The limit only applies if you claim Social Security before reaching your full retirement age.

The earnings limit increases (to $56,520 in 2023) for the calendar year in which you’ll reach full retirement age. 

Starting in the month you hit your full retirement age, there is no longer an earnings limit. Your benefits will no longer be reduced regardless of how much income you have.

The earnings limit specifically applies to earnings from wages or self-employment. Your pension,

This is the hidden content, please

• Sign In
• or
• Sign Up

and investment income do not count toward it.

Special Rule for Your First Year of Retirement

What happens if you retire mid-year and have already exceeded the earnings limit? There’s a special rule you’ll want to keep in mind for your first year of retirement, assuming you claim your benefits

This is the hidden content, please

• Sign In
• or
• Sign Up

.

Suppose you’re 62 and you retire after working a portion of the year, say in August, and you’ve already earned $45,000. Despite exceeding the annual limit by $23,760, your Social Security benefit won’t be reduced as long as any additional monthly earnings are less than or equal to 1/12th the 2023 earnings limit.

Story continues

In other words, you’ll receive your full payment each month assuming you don’t make more than $1,770 that month. (And if you need more help planning for Social Security,

This is the hidden content, please

• Sign In
• or
• Sign Up

.)

The Reduction Is Temporary, and You Get it Back

This is the hidden content, please

• Sign In
• or
• Sign Up

Ask an Advisor: How Much Money Can I Earn Working After Taking Social Security at Age 62?

It’s worth noting that the earnings limit reduction is temporary and you end up getting that money back over time. When you reach full retirement age, your benefit increases (although not right away) to account for the reduction you had due to the earnings limit.

Don’t confuse the early filing reduction with the earnings limit reduction. Claiming Social Security early will result in a permanent reduction in benefits compared to waiting until your full retirement age. (And if you need picking the right time to claim Social Security,

This is the hidden content, please

• Sign In
• or
• Sign Up

.)

Next Steps

Remember that your

This is the hidden content, please

• Sign In
• or
• Sign Up

determine your benefit amount. If you continue to work while receiving your Social Security payments you may be increasing your benefit. If you are earning more than any of your previous highest 35 years then your primary insurance amount will increase.

Tips for Finding a Financial Advisor

This is the hidden content, please

• Sign In
• or
• Sign Up

 doesn’t have to be hard. 

This is the hidden content, please

• Sign In
• or
• Sign Up

 matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, 

This is the hidden content, please

• Sign In
• or
• Sign Up

.

Consider a few advisors before settling on one. It’s important to make sure you find someone you trust to manage your money. As you consider your options, 

This is the hidden content, please

• Sign In
• or
• Sign Up

 to ensure you make the right choice.

Keep an emergency fund on hand in case you run into unexpected expenses. An emergency fund should be liquid — in an account that isn’t at risk of significant fluctuation like the stock market. The tradeoff is that the value of liquid cash can be eroded by inflation. But a high-interest account allows you to earn compound interest. 

This is the hidden content, please

• Sign In
• or
• Sign Up

.

Brandon Renfro, CFP® is a SmartAsset financial planning columnist and answers reader questions on personal finance topics. Got a question you’d like answered? Email *****@*****.tld and your question may be answered in a future column.

Please note that Brandon is not a participant in the SmartAsset AMP platform, nor is he an employee of SmartAsset. He has been compensated for this article.

Photo credit: ©iStock.com/Nes, ©iStock.com/FG Trade

The post

This is the hidden content, please

• Sign In
• or
• Sign Up

appeared first on

This is the hidden content, please

• Sign In
• or
• Sign Up

.

This is the hidden content, please

• Sign In
• or
• Sign Up

#Social #Security #Money #Earn #Working

This is the hidden content, please

• Sign In
• or
• Sign Up

This is the hidden content, please

• Sign In
• or
• Sign Up