5. The Social Security Administration has adjusted the exempt amounts for the earnings test
If you receive Social Security retirement benefits and haven’t reached full retirement age, your benefits may be reduced if your earnings exceed specific limits. This is commonly known as the retirement earnings test, and it can cost you plenty of benefits if you still go to work. Here’s what to expect in 2025 regarding the retirement earnings test exempt amount, as experts say:
Suppose you begin collecting your Social Security before you reach your full retirement age. In that case, you can earn up to $1,950 per month (or $23,400 per year) in 2025 without the Social Security Administration withholding any benefits.
However, for every $2 earned above this limit, $1 in benefits will be withheld. For 2024, the maximum exempt earnings were set at $1,860 per month (or $22,320 per year). This rule applies in the year you turn full retirement age, but only until the month of your birthday when you reach full retirement age.
Other than that, this also comes with much more forgiving terms. For instance, in 2025, you could earn up to $5,180 per month, which means $62,160 per year. That’s before the benefits are withheld, at the rate of $1 in benefits for every $3 earned above the limit, instead of every $2. In 2024, things were pretty different, and the threshold was $4,960 per month or $59,520 per year.
