You may wish to work in some capacity after you retire. In April 2000, the law that determines what happens when you work and get benefits at the same time changed. While you're working, your benefit amount will now be reduced only until you reach your full retirement age, not up to age 70. You can use the following formula to determine how much your benefit will be reduced: If you are under full retirement age (currently age 65) when you start collecting Social Security payments, $1 in benefits will be deducted for each $2 you earn above the annual limit (the annual limit, or retirement earnings exempt amount, is determined by an automatic adjustment procedure that will be adjusted periodically). In the year you turn full retirement age, $1 in benefits will be deducted for every $3 you earn above a different limit, but only counting earnings before the month you reach the full benefit retirement age. Starting with the month you reach full retirement age, you will receive your benefits with no limit on your earnings.

When figuring out how much is deducted from your benefits, only the wages you make from a job, or your net profit if you're self-employed is counted. This includes bonuses, commissions and vacation pay, but not pension, annuities, investment income, interest, veterans or other government or military retirement benefits. It is important to remember that when you continue to work while you get benefits, Social Security will check your record every year to see if those additional earnings will increase your monthly payment. If there is an increase, they will send you a notice of your new benefit amount.