How Much Can You Make on Social Security? Income Limits, Work Rules, and Real Numbers
Photo by Alexander Grey
What “Making Money on Social Security” Actually Means
When people ask how much they can make on Social Security, they’re usually talking about one of two very different things.
The first is how much money Social Security itself pays each month.
The second is how much additional income they can earn from work while receiving benefits.
Most confusion around Social Security comes from mixing those two ideas together.
Social Security benefits are based on your work history and when you choose to start collecting. That monthly benefit amount is separate from whether you continue working.
Earnings, on the other hand, refer to money you make from a job or self-employment after you’ve started receiving Social Security. That’s where income limits and rules come into play.
Here’s the key distinction:
Social Security benefits are what you receive.
Earnings are what you make on top of those benefits.
Someone who asks, “How much can you make on Social Security?” might really be asking:
How much will my monthly check be?
How much can I earn from a part-time job?
Will working reduce my benefits?
Do the rules change once I reach full retirement age?
All of those questions have different answers, even though they sound similar.
This article addresses both sides of the equation, but keeps them clearly separated.
First, we’ll look at what Social Security typically pays each month. Then we’ll walk through how earning additional income works, and how the rules change depending on your age.
Once those pieces are clear, the rest of the decisions become much easier to evaluate.
Monthly Social Security Benefit Amounts: What You Can Expect
How much Social Security pays each month depends on two main things: how much you earned during your working years, and when you choose to start collecting benefits.
There isn’t one standard amount that everyone receives, but there are some useful averages and boundaries that help set expectations.
As of recent SSA data, the average monthly Social Security retirement benefit for individuals is just under $2,000 per month. Many people receive less than that, and some receive more, depending on their earnings history.
Social Security calculates your benefit using your highest 35 years of earnings, adjusted for inflation. Those earnings are averaged into what’s called your average indexed monthly earnings, which is then used to determine your primary insurance amount. That number becomes the baseline for your monthly benefit at full retirement age.
When you start collecting matters just as much as how much you earned.
If you start benefits at age 62, your monthly payment is permanently reduced. The tradeoff is that you receive checks for more years.
If you wait until full retirement age, which is between 66 and 67 for most people today, you receive your full calculated benefit.
If you delay benefits past full retirement age, your monthly benefit increases each year you wait, up until age 70. At that point, the increase stops.
To give a rough sense of the range:
Someone with a modest earnings history might receive closer to $1,200 to $1,500 per month.
Someone with higher lifetime earnings may receive $2,500 or more.
The maximum benefit is reserved for people who earned at or near the Social Security wage cap for many years and delayed benefits until age 70.
These monthly amounts are helpful context, but they’re only part of the picture.
Many people continue to work in some capacity after claiming benefits, which brings us to the next important question: what happens when you earn additional income while collecting Social Security?
Can You Work and Still Collect Social Security Benefits?
Yes, you can work while collecting Social Security.
How much you can earn without affecting your benefits depends on your age and whether you’ve reached full retirement age.
The Social Security Administration uses what’s called the retirement earnings test to determine when benefits are temporarily withheld.
If you are under full retirement age
If you start collecting benefits before full retirement age and continue working, your earnings are subject to an annual limit.
For 2025, the earnings limit is $23,400.
If you earn more than that amount, Social Security withholds $1 in benefits for every $2 you earn above the limit.
For example, if you earn $25,400 while under full retirement age, you are $2,000 over the limit. Social Security would withhold $1,000 in benefits over the course of the year.
Those withheld benefits are not lost permanently. Once you reach full retirement age, your monthly benefit is recalculated to account for months when benefits were withheld.
In the year you reach full retirement age
The rules are more generous during the year you reach full retirement age.
In 2025, the earnings limit for this transition year is $62,160.
If you earn more than this amount, Social Security withholds $1 in benefits for every $3 you earn above the limit.
Importantly, only earnings before the month you reach full retirement age are counted. Income earned after that month is not subject to the earnings test.
This allows many people to work more during their final year before full retirement age without significantly reducing benefits.
After you reach full retirement age
Once you reach full retirement age, the earnings limit no longer applies.
You can earn any amount from work, and your Social Security benefits will not be reduced, regardless of income.
This is why many people who plan to keep working prefer to wait until full retirement age (or later) to claim benefits.
What counts as earnings
For Social Security purposes, earnings include:
Wages from a job
Net income from self-employment
Earnings do not include:
Pensions
Investment income
Interest or dividends
Withdrawals from retirement accounts
Knowing exactly what counts helps avoid accidental overages and unexpected benefit withholding.
What happens to withheld benefits
This part is often missed.
When benefits are withheld because of excess earnings, they aren’t gone forever.
Once you reach full retirement age, Social Security recalculates your benefit and increases your monthly payment to account for the months when benefits were withheld.
In other words, withholding affects timing, not your lifetime benefit amount.
Self-Employment, Side Income, and What Counts as Earnings
When it comes to Social Security, not all income is treated the same. This is especially important if you’re earning money outside of a traditional W-2 job.
Social Security looks specifically at earned income. That includes wages from a job and net earnings from self-employment.
It does not include every dollar that shows up in your bank account.
If you’re working a part-time job and receiving a paycheck, your gross wages count toward the earnings limits we discussed earlier.
If you’re self-employed or running a side hustle, Social Security counts your net earnings, not your total revenue.
Net earnings means:
Your income after legitimate business expenses, not the total amount clients pay you
For example, if you bring in $40,000 from freelance work but have $10,000 in deductible business expenses, Social Security looks at $30,000 when applying the earnings limit.
This distinction matters a lot for retirees with flexible or seasonal income.
Common types of income that do count:
Wages from a job
Freelance or contract work
Consulting or self-employment income
Gig work like rideshare or delivery services
Common types of income that do not count:
Social Security benefits themselves
Pensions or annuities
IRA or 401k withdrawals
Investment income like dividends or capital gains
Rental income where you are not materially participating
One area that often surprises people is side hustles. Even small amounts of freelance or gig income can count toward the earnings limit if you are under full retirement age.
That includes things like:
Selling services online
Consulting part-time
Running a small business
Occasional contract work
The key takeaway is this: if the income is considered as “active” income, or earned through your labor, Social Security usually counts it.
This is why tracking income and expenses becomes especially important if you’re collecting benefits and still working.
Clear records help ensure your reported earnings are accurate and that you’re not overstating income that could unnecessarily reduce your benefits.
For many retirees, self-employment can actually provide more control. Because expenses reduce net earnings, it’s often easier to manage income strategically compared to a fixed hourly job.
Is It Better to Delay Social Security to Earn More Overall?
This is one of the most common and most misunderstood questions around Social Security.
On the surface, taking benefits as early as possible can feel like the obvious move. You’ve paid into the system for decades. Why not start collecting as soon as you’re eligible?
But timing matters more than most people realize.
When you claim Social Security has a permanent impact on how much you receive each month for the rest of your life.
Here’s how the timing works in simple terms.
If you claim early (as early as age 62), your benefit is reduced permanently.
If you claim at full retirement age, you receive your full calculated benefit.
If you delay past full retirement age, your benefit increases each year you wait, up to age 70.
Those increases are not small.
Social Security increases your benefit by about 8 percent per year for each year you delay beyond full retirement age, up to age 70. Over time, that can add up to a significantly larger monthly check.
Why delaying can make sense financially
Delaying benefits can be especially powerful if:
You expect to live into your late 70s or beyond
You are still working or have other income sources
You want a higher guaranteed income later in life
You are planning around a spouse’s benefits
A higher monthly benefit later can provide more stability as other income sources change or fade. For many households, Social Security becomes a larger percentage of income as they age.
Delaying essentially trades earlier payments for higher lifetime protection.
Why claiming earlier can still be the right choice
That said, delaying is not always the best move.
Claiming earlier may make sense if:
You need the income to cover basic expenses
You have health concerns or a shorter life expectancy
You want to reduce pressure on savings early in retirement
You plan to continue working but at a lower income level
There is no universally correct age to claim. The “best” choice depends on cash flow, health, longevity expectations, and how Social Security fits into the rest of your financial picture.
What this means for earning while on Social Security
If you’re planning to keep working or earning income, delaying benefits can sometimes simplify things.
When you delay there are no earnings limits to worry about and you avoid temporary benefit reductions. Additionally, you lock in a higher future benefit.
For people who want to work into their late 60s, delaying can remove friction and reduce complexity.
The real question to ask
Instead of asking, “What age should I claim Social Security?” a better question is:
“What role do I want Social Security to play in my overall income plan?”
For some families, Social Security is a bridge.
For others, it’s a long-term foundation.
Once you’re clear on that role, the timing decision becomes much easier to evaluate.
What Social Security Can (and Can’t) Do for Your Income
So, how much can you make on Social Security?
The honest answer is that Social Security is rarely meant to do everything on its own.
For most people, it works best as a foundation. A reliable base of income that supports your essentials while other income sources fill in the rest.
What matters more than hitting a “perfect” number is understanding how Social Security fits into your real life:
When you plan to claim
Whether you’ll keep working
How much flexibility you want in your later years
What expenses you want guaranteed income to cover
For some households, Social Security plus part-time work creates plenty of breathing room.
For others, delaying benefits and stacking savings leads to more long-term stability. Neither approach is right or wrong. The best strategy is the one that supports your health, lifestyle, and peace of mind.
If there’s one takeaway, it’s this: Social Security works best when it’s planned around, not reacted to. A little clarity up front can prevent a lot of stress later.
FAQ: How Much Can You Make on Social Security?
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As of recent Social Security Administration data, the average monthly retirement benefit is around $1,900 per month.
That equals roughly $22,800 per year.
Some people receive less, especially if they earned lower wages or claimed early.
Others receive more, particularly if they worked longer and delayed benefits.
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The maximum benefit depends on when you claim:
At full retirement age, the maximum monthly benefit is roughly $3,800
At age 70, the maximum benefit can exceed $4,800 per monthTo qualify for the maximum, you must have earned at or above the Social Security wage cap for many years and delay claiming until age 70.
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Yes. You can work while receiving Social Security. If you claim before full retirement age, earnings above certain limits may temporarily reduce your benefit.
Once you reach full retirement age, there is no earnings limit. You can earn as much as you want without affecting your monthly benefit.
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In some cases, yes. If your current earnings are higher than one of the years used in your benefit calculation, Social Security may recalculate your benefit upward.
This usually results in a small increase, but over time it can add up.
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Social Security benefits may be taxable depending on your total income.
If you have other income from work, investments, or retirement accounts, a portion of your benefits may be subject to federal income tax. Many people are surprised by this, so it’s worth planning ahead.
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For some people, yes. For many, it covers basic expenses but not much more.
Social Security is designed to replace only a portion of your pre-retirement income, not all of it.
That’s why combining it with savings, part-time work, or other income sources often leads to more flexibility and less stress.
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Earlier than most people expect.
Even in your 40s or 50s, understanding how benefits are calculated and how claiming ages affect income can help you make better decisions with savings, work, and retirement timing.
