We all dream of a golden retirement, with exotic trips, golf afternoons or tea with friends. But the reality of Social Security is much more than that, and sometimes it can be a roller coaster of bureaucracy, formalities and sometimes incomprehensible requirements. In the worst case, if you ignore some of their restrictions, you may lose your benefits and say goodbye to your monthly payments.
Don’t worry, we have compiled the ways by which a Social Security beneficiary can lose their monthly payments. These are the most common mistakes made by retirees and recipients of other Social Security Administration (SSA) programs, such as Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI).
If You Make Too Much Money, You Could Lose Your Social Security Benefits
As you already know, you can start receiving your benefits from the age of 62. The amount you receive at that age is reduced compared to if you wait until your full retirement age (FRA), which for most retirees is between the ages of 65 and 67.
The longer you delay retirement, the bigger your check will be, but remember that after the age of 70 credits will stop accumulating, so there is no point waiting after that age to start enjoying those golf or poker evenings at home with retired colleagues.
You wouldn’t be losing your benefits per se, but you would be giving up a big chunk of your paycheck (almost 30% in some cases) if you retire too soon or if you wait too long.
Exceeding Income Limits Could Cause You to Lose Your Benefits
If you start receiving your benefits before you reach your FRA, but continue to work, you may lose some of your benefits if your income exceeds certain limits set by the SSA. These limits are adjusted annually and depend on your age, and whether you have applied for full or partial retirement.
It is advisable to visit your local SSA office or call the beneficiary care center at 1-800-772-1213 to find out what those limits are at the moment.
For example, in the year 2024, the earnings limit for those who have applied for retirement benefits but are below their FRA is $22,320 per year, or $1,860 per month. For every $3 earned over this limit, the Social Security Administration (SSA) deducts $1 from benefits.
How You Could Lose Your SSDI Benefits
Social Security Disability Insurance (SSDI) is intended for those people who have suffered a disability or a medical condition that prevents them from working in a lucrative job. If the disability or medical condition improves to the point that you can return to work, you could lose your benefits.
The SSA will be constantly evaluating your medical situation to determine if your condition still qualifies to be severe enough to be unable to work and continue to collect SSDI.
Now, if you receive SSDI benefits and start working again, one way or another the SSA will find out and completely stop sending payments in your name, although it may also happen that the agency is late in finding out about this fact. If so, and they find out that for several months you have been receiving SSDI payments while working, that may qualify as fraud, and you could face federal criminal penalties.
Other types of fraud may include falsifying information on your application, not reporting all of your income, or using your benefits for an unauthorized purpose. If you are convicted of certain crimes, such as fraud or assault, you could lose your SSDI benefits. The length of the suspension of your benefits will depend on the severity of the crime.
How You Could Lose Your SSI Benefits
Like retirement payments, SSI benefits are based on your total income and resources. If your income or resources exceed the limits set by the SSA, your payments may be suspended. Limits and resources include the value of your home, your car, or your savings.
Remember that the SSa requires beneficiaries to report annually how much income or resources they have, and if those reports are not filed, you could run out of payments.