Is It Smart to Take Social Security if I'm Still Working?
Is It Smart to Take Social Security if I'm Still Working?
You're allowed to collect Social Security even if you have a job. Whether it's a good idea will depend on your circumstances. Social Security is a pretty flexible program in that recipients get a choice as to when to claim benefits. You're allowed to sign up for those monthly payments at any age starting at 62.
Why it could pay to claim Social Security even if you have a job
Many people opt to ease their way into retirement rather than quit their jobs cold turkey and stop working completely. Often, older workers will transition into part-time roles for a year or two before retiring in full. And at a time like that when you're not earning a full salary, you may need extra income to supplement your wages. You also may not be ready to start tapping your nest egg. That's where Social Security could help.
Be mindful of the earnings-test limit
If you've reached full retirement age (FRA) for Social Security, then you can earn any amount of money from a job without it impacting your benefits in a negative way. But if you decide to work and collect Social Security prior to reaching FRA, you'll be subject to an earnings-test limit. And wages paid to you beyond that limit could result in some benefits being withheld.
If you decide to transition to part-time work ahead of retirement
It could make more financial sense to tap your nest egg modestly rather than file for Social Security early and reduce those monthly benefits for life in the process.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.