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If I Claim Social Security Benefits at Fra and Continue to Work Will My Benefit Be Recalculated

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SOCIAL Security isn't only for people who are retired.

If you reach the age when you can claim Social Security, you can still work and collect benefits - it could even mean a higher payment for you.

An increase is retroactive to January of the year after you earned the money.

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An increase is retroactive to January of the year after you earned the money.

Every year, the Social Security Administration (SSA) reviews the records of beneficiaries who have received income for the previous year.

If your latest year of earnings is one of your highest years, the SSA recalculates your benefit and will pay you any increase you are due.

The increase is retroactive to January of the year after you earned the money.

If you receive survivors benefits, the additional earnings could help make your retirement benefit higher than your current survivors benefit.

Keep in mind, when you begin collecting Social Security, the SSA considers you retired.

There is a limit to how much you can earn and still receive full benefits.

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How much can you earn?

If you are younger than full retirement age and earn more than the yearly earnings limit, the SSA may reduce your benefit amount.

If you are under full retirement age for the entire year, the SSA will deduct $1 from your benefit payments for every $2 you earn above the annual limit.

For 2022, that limit is $19,560.

In the year you reach full retirement age, the SSA will deduct $1 in benefits for every $3 you earn above a different limit.

In 2022, this limit on your earnings is $51,960.

The SSA will only count your earnings up to the month before you reach your full retirement age, not your earnings for the entire year.

If your earnings will be over the limit for the year and you will receive the retirement benefits for part of the year, the SSA will pay you a full Social Security check for any whole month you are considered retired, regardless of your yearly earnings.

How are earnings deducted from benefits?

In 2022, if you are under full retirement age, the annual earnings limit is $19,560.

If you will reach full retirement age in 2022, the limit on your earnings for the months before full retirement age is $51,960.

Starting with the month you reach full retirement age, there is no limit on how much you can earn and still receive your benefits.

Here is a breakdown:

Under full retirement age all year

  • You are entitled to $800 a month in benefits. That's equivalent to $9,600 for the year.
  • If you work and earn $29,560 - which would be $10,000 over the $19,560 limit - your Social Security benefits would be reduced by $5,000.
  • That's $1 for every $2 you earned over the limit.
  • It would mean you would receive $4,600 of your $9,600 in benefits for the year.

Reach full retirement age in August 2022

  • You are entitled to $800 per month in benefits. That's equivalent to $9,600 for the year.
  • If you work and earn $63,000 during the year - with $52,638 of it in the seven months from January through July - that's $678 over the $51,960 limit.
  • Your Social Security benefits would be reduced through July by $226.
  • That's $1 for every $3 you earned over the limit.
  • You would still receive $5,374 out of your $5,600 benefits for the first seven months. ($5,600 - $226 = $5,374)
  • It would be adjusted beginning in August 2022, when you reach full retirement age, you would receive your full benefit ($800 per month), no matter how much you earn.

The SSA factors in bonuses, commissions, and vacation pay.

Full retirement age

The full retirement age (FRA) is based on your birth year.

  • Birth year: 1943-1954.FRA: 66
  • Birth year:1955.FRA: 66 and two months
  • Birth year:1956.FRA:66 and four months
  • Birth year:1957.FRA:66 and six months
  • Birth year: 1958.FRA: 66 and eight months
  • Birth year: 1959.FRA:66 and 10 months
  • Birth year: 1960 and later.FRA: 67

You can choose to retire as early as the age of 62, but that will result in a deduction of benefits by as much as 30%.

If you receive benefits at full retirement age, it will result in larger benefits.

We help you calculate your retirement benefits.

Plus, we outline the exact dates when Social Security will be paid out in 2022.

Dani Pascarella is a Certified Financial Planner and the CEO and founder of the financial wellness platform, OneEleven.

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Source: https://www.the-sun.com/money/4702255/social-security-benefits-recalculated-increase-payments/

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