Is This Social Security Myth Messing With Your Retirement Plans?

A lot of people end up getting thrown for a financial loop once they retire and realize just how many expenses they’re facing. Unfortunately, many seniors learn the hard way that even a paid-off home can be costly to maintain. And even healthy retirees often find themselves spending a large chunk of their limited income on healthcare, from Medicare premiums to copays for medications.

If money has gotten tight for you in retirement, you may be looking to go back to work to boost your income. And if so, you may be in good company.

In a recent Motley Fool survey, 50% of respondents said they’re considering returning to work because their Social Security benefits don’t do a good enough job of covering their expenses. And given that benefits are only getting a 2.5% cost-of-living adjustment in 2025, more seniors may opt to return to work in some form in the new year.

You may have heard a rumor that there’s no point in working while you’re on Social Security, because that’ll result in having your monthly benefits taken away. But that’s far from the truth.

You can work and collect Social Security at the same time

It’s absolutely false that working means losing your Social Security checks in full automatically. It’s true that some seniors risk losing a portion of those benefits if their earnings exceed a certain limit. But that doesn’t mean you can’t supplement your benefits with income from a job at all.

In 2025, you can earn up to $23,400 without having to worry about losing out on any Social Security. From there, you risk having $1 in benefits withheld per $2 of earnings.

If you’ll be reaching full retirement age in 2025, you can earn even more money without risking having benefits withheld. In that case, you only have $1 in Social Security withheld per $3 of earnings for income beyond the $62,160 point.

And remember, withheld benefits aren’t forfeited for good. You get that portion of your benefits back once your full retirement age arrives.

Also, once you reach full retirement age, the above income limits don’t have to concern you. You can earn $100,000 a year, and you’ll still get the complete monthly Social Security benefit you’re entitled to.

Don’t take part-time work off the table in retirement

Working as a retiree may become necessary for you due to financial constraints. But even if money isn’t tight, you may find that having a job lends to a better quality of life.

Not only might a job keep you nice and busy, but it could also serve as a social outlet for you. And you may find that getting out and about helps you stay physically strong and healthy.

So don’t buy into the myth that if you work as a retiree, you’ll have all of your Social Security taken away. You may, in some cases, have some of your monthly benefits withheld. But even that isn’t a permanent loss. And if you keep your earnings to a certain limit, you can enjoy the benefits of a job without temporarily losing out on any Social Security at all.