How much can i make per month on social security

When you apply for Social Security Disability Insurance (SSDI), one of your top concerns most likely is how much your monthly payment will be if you are eligible for benefits. You need this information so you can be certain that you have sufficient income to survive. However, how your monthly payment is determined is complicated.

How Your SSDI Payments Are Calculated

The severity of your disability will not affect the amount of SSDI benefits you receive. The Social Security Administration (SSA) will determine your payment based on your lifetime average earnings before you became disabled. Your benefit amount will be calculated using your covered earnings. These are your earnings at jobs where your employer took money out of your wages for Social Security or FICA.

Your SSDI monthly benefit will be based on your average covered earnings over a period of time, which is referred to as your average indexed monthly earnings (AIME). The SSA uses these amounts in a formula to determine your primary insurance amount (PIA). This is the basic amount used to establish your benefit.

SSDI payments range on average between $800 and $1,800 per month. The maximum benefit you could receive in 2020 is $3,011 per month. The SSA has an online benefits calculator that you can use to obtain an estimate of your monthly benefits.

Other Income That May Reduce Your SSDI Payment

If you receive other government benefits, your monthly SSDI benefit could be reduced. Sources of income that could affect your payment include:

Worker’s compensation
Public disability benefits
Pension based on work not covered by Social Security, such as a government or foreign government pension

Can You Receive Retroactive Payments?

Once the SSA approves your SSDI application and calculates your monthly benefit, you may be entitled to a back pay award. How many months of payments you will receive will depend on the date you applied for benefits and your disability onset date.

If you are applying for SSDI benefits, you need the assistance of a skilled Social Security disability lawyer to get your application approved and receive the benefits you deserve. To schedule a free consultation with a member of our legal team, fill out the online form on this page or call our Roswell office today.

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You can collect Social Security benefits if you are still working and earning income. But if you earn more than a certain amount from your work—and haven't reached your full retirement age—your benefit will temporarily be smaller. Here's a rundown of how earned income can reduce your Social Security benefits.

Key Takeaways

You can get Social Security and work at the same time, but your monthly benefit may be reduced.
If you have reached full retirement age, you can receive your entire benefit, no matter how much you earn.
If you haven't reached full retirement age, Social Security will deduct $1 from your benefits for every $2 or $3 you earn above a certain amount.
After you reach full retirement age, Social Security will increase your benefits to account for the money it withheld earlier.

Can I Work While Collecting Social Security?

Working During "Retirement"

Remember the days when you could actually retire when you reached a certain age? You could travel, pursue hobbies, and spend more time with family and friends after decades of hard work.

With an increasing number of people unable to save enough to live out their later years in leisure, many are spending retirement working another job, if they retire at all. Of course, some people just enjoy working and want to continue their careers—or do something else that keeps them in the work world—during retirement.

Whatever your motivation, if you keep working after you start receiving Social Security, your eligibility for full benefits gets complicated.

Qualifying for Social Security isn't that difficult. Over the course of your working life, you need 40 credits to be eligible for benefits, which is equal to 10 years of full-time work. In 2021, you get one credit for each $1,470 of earnings ($1,510 in 2022), up to a maximum of four credits per year.

Social Security calculates your benefit amount based on your earnings over the years, whether you were self-employed or worked for an employer. The more money you earned, the more you paid into Social Security—and the higher your future benefits—up to certain limits. The math is much more complicated than this sounds, but that's basically how it works.

What Is Full Retirement Age?

For Social Security purposes, your full or "normal" retirement age is between age 65 and 67, depending on the year you were born. If, for example, your full retirement age is 67, you can start taking benefits as early as age 62, but your benefit will permanently be 30% less than if you wait until age 67.

If you can manage without receiving your Social Security benefits at full retirement age, you can wait until age 70. That will give you the maximum benefit each month.

There's no advantage to waiting past age 70 to start collecting benefits.

The Social Security Administration (SSA) reported in October 2021 that the estimated average monthly retirement benefit will be $1,657. While that regular monthly income helps, it's usually not enough to cover living expenses. That's one reason many people are working longer.

If you work, the money you bring home can affect your Social Security benefits—but the specifics depend on your age and how much you earn. Remember that, although your full retirement age might be 67, you can start receiving benefits at 62, even if you're still working.

But here's the catch: For the 2021 tax year, if you start benefits before full retirement age, you can only earn up to $18,960 ($19,560 for 2022) and still get your full benefits. Once you earn more than the limit, Social Security deducts $1 from your benefits for every $2 you earn.

In the year you reach full retirement age, Social Security becomes more forgiving. If you earn more than $50,520 ($51,960 for 2022) it deducts $1 for every $3 you earn—but only during the months before you reach full retirement age. Once you reach full retirement age, you can earn any amount of money, and it won't reduce your monthly benefits.

Note, however, that any money deducted from your benefit is not permanently lost. After you reach full retirement age, Social Security will recalculate your benefit and increase it to account for the benefits that it withheld earlier.

70 million

The number of people expected to collect some type of Social Security benefit in 2022.

You might wonder how the Social Security Administration keeps track of your work and your earnings. The answer: It doesn't. It's your responsibility to report how much you've made.

"The biggest thing to remember if you are working is to notify the Social Security Administration if you're going to earn wages in excess of the earnings threshold," says Matt Ahrens, an associate financial advisor at Integrity Advisory Group.

Otherwise, he notes, "They will not be notified of your earnings until you file your taxes the following year. And if you were receiving excess benefits, you can be fined, forced to pay back the excess, or receive lower future benefits."

Working Outside of the United States

If you retire and work outside the United States, the rules are different. If you are younger than full retirement age, Social Security will reduce your benefits for every month you work more than 45 hours in a job (or self-employment) that's not subject to U.S. Social Security taxes. That applies regardless of how much money you earn. These rules can get complicated, so you'll want to contact Social Security for advice on your particular situation.

You can collect Social Security retirement benefits at age 62 and still work. If you earn over a certain amount, however, your benefits will be temporarily reduced until you reach full retirement age.

What Is Full Retirement Age?

Full retirement age is the age at which you become eligible to receive full benefits from Social Security. It is 66 years and two months for those born in 1955 and gradually increases to 67 for those born in 1960 and after.

If you start collecting benefits before reaching full retirement age, you can earn a maximum of $18,960 in 2021 ($19,560 for 2022) and still get your full benefits. Once you earn more, Social Security deducts $1 from your benefits for every $2 earned.

The Bottom Line

If you paid into Social Security long enough to earn 40 credits and have reached your full retirement age, you can make as much money as you like without having your Social Security benefits reduced. If you start collecting benefits earlier and earn over a certain amount, a portion of your benefits will be withheld. But once you reach full retirement age, Social Security will recalculate your benefit to make up for the money it withheld earlier.

The maximum benefit depends on the age you retire. For example, if you retire at full retirement age in 2022, your maximum benefit would be $3,345. However, if you retire at age 62 in 2022, your maximum benefit would be $2,364. If you retire at age 70 in 2022, your maximum benefit would be $4,194.

When you reach your full retirement age, you can work and earn as much as you want and still get your full Social Security benefit payment. If you're younger than full retirement age and if your earnings exceed certain dollar amounts, some of your benefit payments during the year will be withheld.

You can get Social Security retirement or survivors benefits and work at the same time. But, if you're younger than full retirement age, and earn more than certain amounts, your benefits will be reduced. The amount that your benefits are reduced, however, isn't truly lost.

$56,520/yr. ($4,710/mo.) NOTE: Applies only to earnings for months prior to attaining full retirement age. One dollar in benefits will be withheld for every $3 in earnings above the limit.