Retirees Need More Income, But Without Losing Their SSA Check: What Is the Working Freedom Act?

If you need to keep working during retirement to cover expenses, the Working Freedom Act proposal could interest you.

Senators in Washington are seeking to eliminate a rule that reduces Social Security benefits for retirees who continue earning income.

Why it matters: The change would allow many retirees to increase their earnings without affecting their Social Security payments.

The Working Freedom Act seeks to eliminate a rule that reduces benefits

The initiative, known as the Working Freedom Act for Older Americans, was introduced this year in Congress and has a specific goal: eliminating the retirement earnings test.

Currently, people who claim Social Security benefits before reaching full retirement age may face temporary reductions in their payments if their work income exceeds limits established by law.

For 2026, the threshold used in the proposal’s analysis is around $24,480 per year. Those who exceed that amount may have a portion of their benefits withheld.

Supporters of the proposal believe this rule no longer reflects the economic reality of many older adults who need to remain active in the workforce.

Senator Greg Murphy promotes the bill in the House

Republican Congressman Greg Murphy, representative of North Carolina, introduced the legislation in the House of Representatives.

The lawmaker argues that program benefits were earned through years of contributions and that retirees should not face additional obstacles for choosing to continue working.

The proposal would eliminate the reduction tied to work income for those receiving early benefits, allowing beneficiaries to keep their full Social Security payments.

Social Security retirement income rules – PHOTO: Shutterstock

Rick Scott says the rule is outdated

The initiative also has support in the Senate.

At the end of March, Senator Rick Scott led a hearing titled “Experience Matters: Seniors and the Workforce,” where he defended the need to modernize current rules.

Scott argued that the retirement earnings test was created during the Great Depression with the goal of opening jobs for younger workers.

According to his comments during the hearing, that economic reality no longer exists and the employment needs of older Americans have changed significantly.

The senator stated that many retirees want to continue participating in the economy, contribute their experience, and increase their income without being penalized for doing so.

Social Security retirement income rules – PHOTO: Shutterstock

How do current laws affect retirees who continue working?

One of the main arguments from supporters of the proposal is that many retirees face higher living costs and need additional income to maintain financial stability.

Under current rules, a person between ages 62 and 66 who began collecting early benefits may see their payments reduced if they exceed established income limits.

Supporters of the legislation argue that this discourages work and reduces financial flexibility for those who want to remain active.

The legislation also seeks to make it easier for employers to benefit from the experience of older workers in industries facing labor shortages.

Social Security retirement income rules – PHOTO: ChatGPT

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What comes next

For now, the Working Freedom Act for Older Americans continues through the legislative process in Congress and has not yet been approved.

If it moves forward, it could modify one of the most debated rules affecting people who collect early Social Security benefits and want to continue working.