2. Workers will lose more of their money to Social Security taxes
Each year, there’s a wage cap that dictates how much earnings workers pay taxes on. In 2022, the wage cap is rising from $142,800 to $147,000. Lower earners won’t be impacted by this change, but if you earn more than $142,800, expect a higher tax bill.
3. Higher earnings will be needed to earn work credits
To be eligible for Social Security in retirement, you need to earn 40 work credits in your lifetime. Work credits are based on earnings, and you can earn a maximum of four per year.
In 2022, the value of a work credit will rise from $1,470 to $1,510. That means it will take $6,040 in earnings to earn four work credits next year. This isn’t something that will impact full-time workers, but it could have an impact on those who work on a part-time basis.
4. The earnings-test limits have gone up
The Social Security Administration allows seniors to work and collect benefits at the same time. Those who do so after reaching full retirement age (FRA) don’t have to worry about how much they earn. But if you haven’t reached FRA and intend to hold down a job while collecting Social Security, you’ll need to be mindful of the earning-test limits.
