Q: I plan to retire in June 2011 on my 62nd birthday. If I work up until that date and make approximately $20,000 will my Social Security benefits be reduced?
A: The Social Security Administration has a special “first year” rule that lets them pay a full Social Security check for any whole month they consider you retired, regardless of your yearly earnings. In other words, the pay you received before retiring won’t count against the earnings limit. Note: In 2010, if you are below full retirement age, you are considered retired in any month that your earnings are $1,180 or less and you did not perform substantial services in self employment.