Working While Collecting Social Security – New Earnings Limits and Rules for 2026

As of January 2026, the Social Security Administration (SSA) is introducing key changes to the rules surrounding working while collecting Social Security benefits. These updates aim to accommodate inflation and rising wages, offering more earning potential before penalties apply. For early retirees and individuals working while receiving Social Security, this means more flexibility to increase their income without sacrificing a substantial portion of their monthly benefits.

But how do these changes actually impact your benefits? If you are under Full Retirement Age (FRA), you may still face reductions if you exceed the new earnings limits, but don’t worry—the withheld amounts will be recalculated and added back to your benefits once you hit FRA. This move creates greater financial stability for workers who want to stay active without being penalized too heavily. Let’s break down what these changes mean for you.

Earnings Limits Adjustment

In 2026, the earnings limit for working while receiving Social Security benefits will rise. This adjustment is designed to help retirees and early claimants keep pace with inflation and wage growth. Here’s a closer look at the new limits:

Under Full Retirement Age (FRA): The earnings limit will rise from $23,400 in 2025 to $24,480 in 2026. If you earn more than this, $1 will be deducted from your benefits for every $2 you exceed the limit.

Year of Reaching FRA: For those who turn 66 or 67 in 2026, the earnings limit will increase from $62,160 in 2025 to $65,160 in 2026. In this case, the SSA will deduct $1 for every $3 you exceed the limit.

Full Retirement Age or Older: Once you reach FRA, there is no earnings limit, meaning you can earn any amount without any reduction in your Social Security payments.

Overview of the New Earning Limit 2026

Age Group2025 Earnings Limit2026 Earnings LimitBenefit DeductionUnder Full Retirement Age (FRA)$23,400$24,480$1 for every $2 earned over the limitYear Reaching FRA$62,160$65,160$1 for every $3 earned over the limitFRA or OlderNo LimitNo LimitNo deduction

Eligibility Rules

To qualify for Social Security benefits, you must meet certain conditions. Here’s a quick overview:

Social Security Retirement Benefits:

You must have worked for at least 10 years (40 credits) and contributed to the Social Security system through payroll taxes.

You can start collecting benefits as early as age 62, but your full benefit amount is available once you reach Full Retirement Age (FRA), which is 67 for those born in 1960 or later.

Social Security Disability Insurance (SSDI):

Available to those who are disabled and unable to work full-time. You must have a qualifying disability and enough work credits to qualify.

Earnings Test for Early Beneficiaries:

If you claim Social Security before FRA and continue working, your earnings will be subject to the earnings limits.

Once you reach FRA, there are no earnings restrictions, and you can earn as much as you want without affecting your benefits.

Benefits of the Program

The new earnings limits for 2026 bring several advantages to those receiving Social Security benefits but still want to keep working. Here’s how you can benefit:

Increased Earnings Potential: The updated earnings limits mean you can earn more without facing reductions in benefits. This gives you greater financial flexibility, especially if you need extra income.

Temporary Reduction: If you exceed the new limits, your benefits will be temporarily reduced, but they will be recalculated once you reach FRA. The SSA will add back any withheld payments to your monthly benefits.

More Working Freedom: These adjustments allow you to work more without the fear of losing significant portions of your Social Security benefits. This is particularly helpful for early retirees who wish to continue working without long-term penalties.

Easier Path for Early Claimants: Early retirees who still want to work will find these new limits much more manageable, as it provides a clearer pathway for earning without major reductions to their benefits.

Payment Details

The earnings limits apply based on whether you are under, at, or above FRA. Here’s a table summarizing the earnings limits and benefit deductions for 2025 and 2026:

Age Group2025 Earnings Limit2026 Earnings LimitBenefit DeductionUnder Full Retirement Age (FRA)$23,400$24,480$1 for every $2 earned over the limitYear Reaching FRA$62,160$65,160$1 for every $3 earned over the limitFRA or OlderNo LimitNo LimitNo deduction

Note: These limits apply to earned income only (wages, self-employment income). They do not apply to income from investments, pensions, or other sources.

Social Security Earnings Limits Over Time

Here’s how the earnings limits have increased over the years, reflecting the need for adjustments based on inflation and wage growth:

YearUnder FRA Earnings LimitYear Reaching FRA Earnings Limit2025$23,400$62,1602026$24,480$65,160

These increases, while seemingly small, make a significant impact on those who rely on Social Security benefits and wish to continue working without facing major penalties.

Recent Updates

December 2025: The SSA confirmed the 2026 earnings limit adjustments.

October 2025: The Social Security COLA (Cost of Living Adjustment) for 2026 will rise by 2.8%, which will increase benefits for millions of recipients.

Why It Matters?

The new earnings limits provide significant relief for those who want to continue working while receiving Social Security benefits. For many, Social Security is their primary income, and the ability to earn extra income without severe penalties offers greater financial security.

These adjustments are a step in the right direction to keep up with inflation and rising costs, especially as many retirees may need to supplement their income due to higher living expenses. However, while these changes offer more flexibility, the real value of Social Security benefits continues to be a topic of concern, and further adjustments may be necessary to ensure benefits keep pace with living costs.

FAQs

Will I lose Social Security benefits if I earn over the earnings limit?

No, your benefits will be temporarily withheld, but they will be recalculated and added back once you reach FRA.

What is the maximum amount I can earn without reducing my benefits in 2026?

If you are under FRA, you can earn up to $24,480 without reducing your benefits. If you’re reaching FRA in 2026, the limit increases to $65,160.

Will there be any deductions after I reach full retirement age?

No, once you reach FRA, you can earn unlimited income without any deductions from your Social Security benefits.

When will the new earnings limits be implemented?

The new earnings limits apply to income earned starting January 2026.

Are these earnings limits permanent?

No, the earnings limits are adjusted annually to keep up with inflation and wage growth, so they may change in future years.