There are plenty of benefits to holding down a job in retirement. For one thing, the extra income might help.
The average retired worker on Social Security today gets a little more than $2,000 a month in benefits. And even though benefits are getting a 2.8% cost-of-living adjustment in 2026, that will only result in a roughly $56 increase for the typical senior.
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Plus, the reality is that many seniors do not have much or any retirement savings. So working could be a great way to boost your income and avoid financial stress.
There are also social and emotional benefits of working to consider. Holding down a job gives you a reason to leave the house. It can give you an opportunity to interact with people and, in some cases, get your body moving.
If you're collecting Social Security, you should know that you're allowed to work while receiving monthly benefits. But the rules of working while on Social Security are changing in 2026 -- for the better. It's important to know what to expect so you can plan accordingly.
How Social Security's earnings test works
Once you reach full retirement age, which is 67 if you were born in 1960 or later, you can earn any amount of money from a job without the risk of having some of your Social Security withheld.
But you're allowed to sign up for Social Security as early as age 62. So many seniors end up collecting benefits well before reaching full retirement age.
If you work and receive benefits prior to full retirement age, you'll be subject to an earnings test. And exceeding its limit could mean having some or even all of your Social Security check withheld.
But it's important to realize that withheld benefits are not the same thing as forfeited benefits. If you have some of your Social Security withheld in the near term, once you reach full retirement age, your monthly benefits will be recalculated and boosted to make up for the money you didn't get initially.
That said, filing for Social Security ahead of full retirement age reduces your monthly checks on a permanent basis. You may not wish to do that only to then have some of those benefits withheld. So it's important to familiarize yourself with the earnings-test limits.
Social Security's earnings-test limits are rising in 2026
The more money you're able to earn without risking having Social Security withheld, the better. So the fact that the program's earnings-test limits are rising in 2026 is a good thing.
- For workers under full retirement age in 2026, the earnings-test limit is rising from $23,400 to $24,480. Beyond that point, $1 in Social Security will be withheld per $2 of earnings.
- For workers reaching full retirement age in 2026, the earnings-test limit is rising from $62,160 to $65,160. Beyond that point, $1 in Social Security will be withheld for every $3 of earnings.
If you start off 2026 having reached full retirement age, there's no earnings test to worry about, as it won't apply to you.
Is it worth working if you think you'll exceed the earnings-test limit?
You may be wondering if you should bother getting or keeping a job in retirement if it'll mean exceeding the earnings-test limit. But earning an income in retirement could benefit you in a surprising way.
The Social Security Administration (SSA) uses your 35 highest-paid years of earnings to calculate your monthly benefits. If you didn't work 35 years prior to signing up, and you can replace a year of zero earnings with an income that's high enough to exceed the earnings-test limit, it could result in higher monthly payments once the SSA recalculates your benefits based on your updated earnings record.
Of course, if you don't like the idea of having some of your Social Security withheld, you could try to limit your hours or income to stay below the earnings-test limit. That should be an easier thing to do in 2026 thanks to the aforementioned change.
