Social Security is a federal program that provides retirement and disability benefits to eligible individuals. Many retirees rely on Social Security to supplement their income and provide financial stability in retirement. Knowing when you can begin earning unlimited income on Social Security is an important part of planning for retirement.
Earning Unlimited Income on Social Security
Social Security benefits are subject to certain limits. There are income limits for those who are still working and collecting Social Security benefits. If you earn more than the income limit, your benefits will be reduced. However, once you reach full retirement age, you can earn an unlimited amount of income without affecting your Social Security benefits.
Full retirement age is determined by the year you were born. If you were born between 1943 and 1954, your full retirement age is 66. For those born after 1954, the full retirement age gradually increases to 67.
Age Requirements for Benefits
You can start collecting Social Security benefits as early as age 62, but your benefits will be reduced if you start collecting before your full retirement age. If you wait until after your full retirement age to begin collecting benefits, your benefits will be higher.
The Social Security Administration also offers an earnings test for those who are still working and collecting Social Security benefits. If you are younger than full retirement age and earn more than the annual limit, your benefits will be reduced. The annual limit changes each year and is determined by your age.
Knowing when you can begin earning unlimited income on Social Security is important for planning for retirement. If you are younger than full retirement age, you may be subject to income limits that can reduce your benefits. But once you reach your full retirement age, you can earn an unlimited amount of income without affecting your Social Security benefits.
As we age, it’s important to be aware of when we can start to earn unlimited income on Social Security. Many people may not be aware that Federal law allows those over the age of 70 and a half to earn Social Security benefits, regardless of how much income they bring in.
When you turn 70 and a half, you are allowed to keep all of your Social Security benefits, provided you still receive them. Prior to that, each dollar you made over a certain amount was deducted from your Social Security benefits. That limit is currently $17,640.
This law applies to earned income from any job, not just Social Security. Any income you receive from pensions, investments, or any other sources does not count as earned income for Social Security’s purposes.
Knowing when you can start receiving unlimited Social Security income helps you plan for the future. This is true, particularly if you’re planning to retire after 70 or if you plan to start collecting Social Security benefits while continuing to work.
If you do decide to start collecting Social Security benefits after reaching the age of 70 and a half while maintaining a job, there are some key things to be aware of. The amount of Social Security benefits you receive may be taxed, depending on your overall income, and you are also subject to the Social Security earnings limit once you reach full retirement age (66 to 67 years old depending when you were born).
Finally, you should keep in mind that the Social Security Administration does not consider self-employment starter kits or direct sales income for the earnings limit. So, if you are starting a business on the side, your Social Security income would not be affected.
Overall, those who reach 70 and a half can receive unlimited Social Security income even if they continue to work. Knowing how to maximize your income as you approach retirement can help you make the most out of your golden years.