How Will Working Affect Social Security Benefits?

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How Working in Retirement Affects Social Security Benefits

In a recent survey, 73% of workers stated they plan to continue working after retiring. This raises an important question: How will working impact your Social Security benefits?

To answer this, you need to understand three key concepts:?full retirement age, the?earnings test, and?taxable benefits.

• Full Retirement Age: This is the age at which you are eligible for 100% of your Social Security benefits. For individuals born in 1960 or later, full retirement age is 67. However, you can start receiving reduced benefits as early as age 62, or delay them until 70 for larger monthly payments.
• Earnings Test: If you claim benefits before reaching full retirement age and continue to work, your Social Security benefits may be reduced. In 2024, for every $2 you earn above $22,320, $1 is deducted from your benefits. Once you reach full retirement age, this reduction no longer applies.
• Taxable Benefits: Regardless of age, a portion of your Social Security benefits may be taxable if your combined income exceeds certain thresholds. For couples filing jointly, up to 50% of your benefits may be taxable if your income is between $32,000 and $44,000. If it's more than $44,000, up to 85% of your benefits may be taxable.

Understanding how working affects your Social Security benefits can help you build a retirement strategy that maximizes all your income sources.

1. EBRI.org, 2023

2. SSA.gov, 2023

3. SSA.gov, 2023

4. SSA.gov, 2023

The content is developed from sources believed to be providing accurate information. The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties. Please consult legal or tax professionals for specific information regarding your individual situation. This material was developed and produced by FMG Suite to provide information on a topic that may be of interest.?FMG?Suite?is not affiliated with the named broker-dealer, state- or SEC-registered investment advisory firm.?The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security. Copyright 2024 FMG Suite.