Heads-Up For Retirees: The Social Security Earnings Limit Is Changing In 2026

People intent on receiving their Social Security benefits before their full retirement age (FRA) can earn more money in 2026, without having their benefits deducted. According to the new rules announced by the Social Security Administration, people who decide to start receiving their Social Security benefits at age 62 (the minimum age to start the program, although many argue this is among the worst times to retire), but prior to their FRA of 66 or 67 (depending on the year they were born) can now earn $24,480 annually before facing deductions — $1 is deducted from benefits for every $2 earned over the limit. For those who will reach their FRA sometime in 2026 can now earn $65,160 before facing a $1 benefits deduction for every $3 earned over the limit, until the month of their birthday.

This means an early Social Security recipient can typically earn $1,080 a year more before their Social Security benefits are deducted compared to 2025 when the limit was $23,400. And for early recipients who will reach FRA later in 2026, they can earn $3,000 more prior to their full-retirement birthday month compared to 2025 when the limit was $62,160. Being aware of these new rules is important for anyone planning their retirement, especially those who might hope to delay any withdraws from their retirement account by receiving their benefits early while still earning a paycheck.

Working people in their 60s should also be aware of the old rules as well, namely when they've reached their full retirement age. Per the SSA, people born between the years 1943 and 1954 reach their FRA when they're 66 years old. That threshold increases by two months every year between 1955 and 1959. (For example, the FRA is 66 years and two months for those born in 1955, 66 and four months for those born after 1956, etc.,) For those born in 1960 or after, the age is 67.

The Social Security test you should expect prior to reaching FRA is known as the retirement earnings test (RET), which is used to figure out how much should be deducted from a Social Security payment in relation to a semi-retiree's earnings. But don't despair, monthly benefits are recalculated at FRA for any semi-retirees and working beneficiaries to account for any missed income. Still, there are disadvantages to claiming Social Security benefits prior to your FRA. For one thing, the average Social Security income for younger recipients is lower. This means someone born in 1960, or after, who retires at age 62 can expect to see a 30% reduction in their Social Security payments. Plus, people usually still can't receive Medicare until after they turn 65.