Social Security earnings limit confusion - does income before retirement month count toward annual limit?

You're dealing with what's called the Monthly Earnings Test for the first year of retirement. You're correct that only earnings AFTER you start collecting SS matter in your first year, as long as you're truly retired (meaning your earnings fall below monthly limits for any remaining months of that year). Basically, if you retire in September 2025 and don't earn over $1,860/month for the rest of 2025 (that's $22,320 ÷ 12), you won't lose any benefits regardless of how much you earned January-August. If you completely stop working in September when you claim, you'll be fine. The annual rule kicks in for 2026 and beyond.

no thats WRONG my sister got hit with this last year they counted ALL her income for the year even before she took SS!! she had to pay back like 4k$$ they took it right out of her checks this year

The previous commenter is correct about the Monthly Earnings Test. Here's the exact explanation from SSA: In the first year you retire, we count earnings differently. Specifically: 1. There's a special rule that applies to earnings for one year, usually the first year of retirement. 2. Under this rule, you can get a full Social Security payment for any whole month you're retired, regardless of your yearly earnings. 3. In 2025, a person under FRA is considered retired if monthly earnings are $1,860 or less. So your pre-September earnings won't matter as long as you properly notify SSA that you're retiring in September and don't earn above the monthly limit after that. Make sure when you apply that you clearly indicate your retirement date so they apply this rule.

Ugh, I had this exact same issue last year and couldn't get a straight answer from anyone at Social Security. Spent weeks trying to call them but could never get through - always disconnected or hours on hold. I finally used a service called Claimyr (claimyr.com) that got me connected to an SSA agent in under 10 minutes. They have a video showing how it works: https://youtu.be/Z-BRbJw3puU The agent confirmed what others are saying - they only count earnings after your retirement month in the first year, as long as you don't exceed the monthly limit. Made sure to note in my file that I was fully retiring on my start date.

My husband retired at 63 last yr & we went thru this. Its called the "first year rule" or "grace year rule" & means they only look at months AFTER u start collecting. But careful - they do check if ur really retired! No big payments from employer can come after or they might count those months as still working. We made sure his vacation payout came before he filed.

I thought ALL income counted no matter when you earned it! Now I'm worried I shouldn't have waited to file. I've been working part-time since January but delayed filing until June because I thought my January-May earnings would count against me. Did I mess up by waiting?? Is there any way to get retroactive payments for those months now?

THIS WHOLE SYSTEM IS DESIGNED TO CONFUSE PEOPLE!!! I spent 40+ years paying into Social Security and when I tried to understand these earnings rules, I got 3 different answers from 3 different SSA reps!!! One told me exactly what you heard - only earnings after filing count in first year. Then another told me it ALL counts but they give grace for some months. Then a third one gave me some complex formula. NO ONE KNOWS WHAT THEY'RE DOING THERE!!! Document EVERYTHING when you talk to them. Get names and direct numbers if possible. The left hand doesn't know what the right is doing.

To summarize what everyone has said and clarify any confusion: 1. In your FIRST year of retirement, SSA applies the Monthly Earnings Test: - They only count earnings in months AFTER you start receiving benefits - For 2025, you can't earn more than $1,860 in any month after claiming - If you earn $0 after claiming, you'll have no benefit reduction 2. Starting January 2026, the Annual Earnings Test applies: - They look at your total annual income - For 2026, you'll likely be subject to the $22,320 annual limit until you reach FRA 3. At Full Retirement Age: - The earnings test disappears completely - You can earn unlimited income with no benefit reduction Make absolutely sure when applying that you specify your retirement date so they apply the Monthly Earnings Test correctly.

I went through this exact same situation two years ago when I retired at 62. The confusion is absolutely understandable because even SSA representatives sometimes give conflicting information! Here's what actually happened in my case: I earned about $68,000 from January through July 2022, then completely stopped working when I started collecting benefits in August. SSA applied the Monthly Earnings Test for my first year, which meant they only looked at my earnings from August onwards (which was $0). I received full benefits for August-December with no reductions. The key things that made this work: - I explicitly stated my retirement date on my application - I made sure to have zero earnings after my benefit start date - I kept documentation showing I had truly retired (final paystub, employer confirmation, etc.) Starting in 2023 (my second year), they switched to the Annual Earnings Test, so now I have to stay under the yearly limit if I want to do any part-time work. The Monthly Earnings Test in your first year is a real lifesaver for people like us who worked most of the year before retiring. Just make sure you're crystal clear about your retirement date when you apply!

As someone who just went through this process last year, I can confirm what others have said about the Monthly Earnings Test for your first year. I was in a very similar situation - earned about $70K through October, then retired and started collecting at 63. The most important thing is being absolutely clear on your application that you're retiring completely. When I applied online, there was a specific section asking about current employment and future work plans. I made sure to indicate my exact retirement date and that I would have zero earnings after that point. One tip that helped me: I actually called the day after I submitted my online application to confirm they had my retirement date noted correctly in their system. The representative was able to verify that the Monthly Earnings Test would apply and that my pre-retirement earnings wouldn't count against me. Also, keep records of everything - your final paystub, any retirement letters from your employer, etc. I never needed them, but it gave me peace of mind knowing I could prove I had actually retired if questions came up later. The system is definitely confusing, but once you understand that first-year rule, it's actually quite generous for people retiring mid-year. Good luck with your application!

I'm in a very similar situation - planning to retire at 63 next year and had the same confusion about the earnings test! Reading through all these responses has been incredibly helpful. The Monthly Earnings Test for the first year makes so much more sense now. One thing I'm curious about - for those who have gone through this process, how long did it take to actually start receiving benefits after applying? I'm wondering if I should apply a few months before my planned September retirement date to make sure everything is processed in time, or if that could complicate things with the earnings test timing. Also, has anyone had issues with employers not understanding the retirement date requirements? I'm worried my HR department might not provide the right documentation or might process my final pay incorrectly in a way that could affect my SSA application. Thanks to everyone who shared their real experiences - this is exactly the kind of practical information that's impossible to find on the SSA website!

I've been following this discussion as someone who recently went through the SSA application process, and I wanted to add one more practical tip that really helped me. When you call SSA (or use that Claimyr service someone mentioned), ask them to put a "remark" or "alert" on your record about your retirement situation. I specifically requested that they note: "Claimant retiring completely on [date], switching from work to full retirement, Monthly Earnings Test should apply for first year." This saved me from having to re-explain my situation every time I called with questions. The representative could immediately see my retirement status and earnings test situation right in their system. Also, don't be surprised if you get a "Retirement Test Annual Report" form (SSA-777) after your first year. This is normal - they're just verifying your earnings for that transition year. Having your documentation organized (final paystubs, retirement letter, etc.) makes filling this out much easier. Your plan sounds solid - earning $75K through September then completely stopping work should definitely qualify for the Monthly Earnings Test with no benefit reduction. Just make sure that retirement date is crystal clear on every form and in every conversation!

I just wanted to thank everyone who contributed to this discussion! As someone who was completely stressed about potentially losing thousands in Social Security benefits due to my pre-retirement earnings, reading these real-world experiences has been incredibly reassuring. The key takeaways that have given me confidence: - The Monthly Earnings Test for the first year only looks at earnings AFTER I start collecting - I need to be crystal clear about my retirement date on the application - Calling after applying to confirm they have the right notes in my file is smart - Keeping all documentation organized for the eventual annual report Special thanks to those who shared their actual dollar amounts and timelines - that concrete information was exactly what I needed to understand how this works in practice. I'm going to move forward with my September retirement plan and stop worrying about my January-August earnings affecting my benefits. This community has been far more helpful than hours of trying to reach SSA directly. Sometimes the best advice comes from people who've actually walked the path you're about to take!

As someone who works in retirement planning, I can confirm that the information about the Monthly Earnings Test for your first year is absolutely correct. This is one of the most misunderstood aspects of Social Security, and unfortunately even some SSA representatives get it wrong. The rule is specifically designed to help people like you who have worked most of the year before retiring. The logic is that you've already committed to those earnings before you decided to claim benefits, so it wouldn't be fair to penalize you for income earned before your retirement decision. A few additional points that might help: - Make sure your employer processes your final paycheck and any accrued vacation/sick pay BEFORE your official retirement date - If you have any consulting or freelance income planned after retirement, keep it under $1,860/month to maintain your retired status - Consider applying 2-3 months before your September target date to allow for processing time The Monthly Earnings Test really is a generous rule that allows for exactly your situation - working a full salary for most of the year, then transitioning to full retirement and Social Security. You're making a smart financial move by understanding these rules before applying!

I went through this exact same situation when I retired at 62 in 2022. Like you, I was earning a full salary through most of the year (about $80K through October) and was terrified about the earnings limit penalties. The Monthly Earnings Test for your first year is real and it works exactly as others have described. I can personally confirm that SSA only counted my earnings from my benefit start date forward, not the income I earned earlier in the year while still working. Here's what I learned that might help you: 1. When you apply online, there's a specific question about your work status and retirement plans. Be very explicit here - don't just say you're "reducing hours" or "semi-retiring." State clearly that you are "fully retiring" on your specific date. 2. I actually printed out the relevant SSA policy pages about the Monthly Earnings Test before applying and kept them with my records. Having the official language helped when I had questions later. 3. Consider timing your application for late June/early July. This gives SSA plenty of time to process everything before your September start date, but you're not applying so early that your circumstances might change. The anxiety about this is completely understandable - the rules are confusing and poorly explained. But once you get through the application process and see that first payment arrive without any deductions, you'll realize the system actually worked as intended. Your plan sounds solid!

I just wanted to add my voice to thank everyone who contributed to this incredibly helpful discussion! As someone who's been lurking in this community for a while but never posted, this thread convinced me to create an account and jump in. I'm in a very similar situation to the original poster - planning to retire at 63 next year and have been absolutely terrified about the earnings test rules. Like many of you mentioned, the SSA website is confusing and I've had zero luck getting through on their phone lines. Reading through all these real-world experiences has been more valuable than months of trying to research this on my own. The consistent message about the Monthly Earnings Test for the first year, combined with specific examples from people who actually went through it, has finally given me the confidence to move forward with my retirement planning. Special thanks to those who shared dollar amounts and timelines - that concrete information made all the difference in understanding how this works in practice rather than just theory. I'm bookmarking this entire thread to reference when I start my own application process! This is exactly why community forums like this are so valuable - sometimes the best advice comes from real people who've walked the path you're about to take, not from official websites or overwhelmed government phone lines.

This has been one of the most helpful threads I've read on this topic! As someone who just turned 62 and is considering early retirement next year, I've been struggling with these same earnings test questions. The distinction between the Monthly Earnings Test for your first year versus the Annual Earnings Test for subsequent years finally makes sense after reading everyone's experiences. What really stands out to me is how many people mentioned getting different answers from different SSA representatives. That's exactly what I've experienced - called twice and got two completely different explanations of how the earnings test works. It's frustrating that we have to rely on community knowledge to get accurate information about our own benefits! For those who successfully navigated this process, did you find that having documentation ready (final paystubs, retirement letters, etc.) helped speed up the application, or was it mainly just for your own peace of mind? I'm trying to figure out if I should gather all that paperwork before applying or if the SSA doesn't actually request it during the initial process. Thanks again to everyone who shared their real experiences - this kind of practical knowledge is invaluable for those of us still in the planning stages!

As someone who recently retired at 63 and went through this exact same process, I can absolutely confirm what others have shared about the Monthly Earnings Test for your first year. The key thing that saved me was being extremely explicit about my retirement date and making sure SSA understood I was completely stopping work. I earned about $72,000 through August 2023 before retiring and starting benefits in September. Because I had zero earnings after my retirement date, I received full benefits with no reductions despite my high pre-retirement income. Here's what I wish I had known earlier: when you apply, don't just mention your retirement date once - emphasize it multiple times throughout the application. I specifically wrote in the remarks section: "Completely retiring from all employment on [date]. Zero earnings expected after this date." This helped ensure they applied the Monthly Earnings Test correctly. Also, I'd strongly recommend calling about a week after submitting your online application to verify they have your retirement status noted properly in their system. The representative I spoke with confirmed they had flagged my account for the Monthly Earnings Test, which gave me huge peace of mind. Your September timeline with $75K in pre-retirement earnings should work perfectly under this rule. Just make sure that retirement date is crystal clear throughout your entire application process!

I'm new to this community but have been researching Social Security timing for months, and this thread has been absolutely incredible! Reading through everyone's real experiences with the Monthly Earnings Test has cleared up so much confusion for me. I'm in a similar boat - turning 63 next year and considering retiring mid-year after earning a full salary through most of the year. Like many others here, I was terrified that ALL my annual income would count toward the earnings limit, which would have made early retirement financially impossible. The consistent experiences shared here about the first-year Monthly Earnings Test - where only post-retirement earnings matter - have completely changed my retirement planning timeline. It's amazing how this one rule makes mid-year retirement actually viable for people who've been working full-time. What strikes me most is how many people mentioned getting conflicting information from SSA directly, yet the community experiences are so consistent. It really highlights the value of peer knowledge sharing when navigating complex government programs. Thank you to everyone who shared specific dollar amounts, timelines, and application tips. This thread is going into my retirement planning folder as required reading! The practical advice about emphasizing retirement dates, following up to verify earnings test applications, and keeping documentation organized is exactly what I needed to feel confident about moving forward.