Social Security Q&A: Does the Earnings Test Only End After 70?

SS photo cropped

Laurence Kotlikoff is a professor of economics at Boston University who has been answering questions and writing columns about Social Security each week for the past two years on PBS NEWSHOUR’s website. OpenRetirement has asked Professor Kotlikoff to post a Q&A each day from those columns. He has also developed software, called Maximize My Social Security, to help retirees secure the highest lifetime Social Security benefits. You can find the software here: www.maximizemysocialsecurity.com

Question: Am I correct that if I wait to age 70 to claim Social Security benefits there are no limits on what I can earn by continuing to work after that? In other words, there won’t be any deductions from my benefits?

Answer: Not quite correct. Social Security’s earnings test ends the nanosecond you reach your full retirement age. That’s age 66 for those born from 1943 through 1954.

Even for those under full retirement age, the earnings test can be far less of an issue than is commonly believed. The reason is that benefits, be they retirement, spousal, or widow(er) benefits, lost due to the earnings test are subject to what Social Security calls “the adjustment of the reduction factor” or ARF. Thanks to the ARF, Social Security bumps up your benefit to fully compensate you in the future for benefits lost in the past due to your having earned too much money.

However, if you were receiving benefit X and lost some of X due to the earnings test and then, after reaching full retirement age, begin taking benefit Y, which exceeds X, the ARF won’t do you any good. The reason is that Social Security only pays the larger (or something quite close to the larger) of the two benefits. In this case Y isn’t “ARF’d,” so the fact that benefit X has been restored to its full value doesn’t matter because you won’t be collecting X. Instead, you’ll be collecting Y.


When it comes to personal finance, economics and our software care about one thing—your living standard. All questions in personal finance boil down to your living standard. Your decision about when and how to take Social Security can affect your living standard throughout your retirement.

I am a professor of economics and I’ve spent a good part of my academic career studying personal financial behavior. Here’s why my colleagues and I developed Maximize My Social Security. Deciding, on your own, which Social Security benefits to take and in which month to take them is incredibly difficult. Most households face millions of options. You can easily lose tens of thousands of dollars making the wrong choices.

My company’s software, Maximize My Social Security, can help you avoid costly mistakes and instead discover your maximized lifetime household benefits.

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