The Social Security Squeeze

Kip Tips

The Social Security Squeeze

If you retired early, started collecting Social Security benefits but had to go back to work because the bear market took a big bite out of your savings, then you took one more hit: The government suspended your Social Security payments.

Kiplinger's Editorial Director Kevin McCormally reports in The Social Security Catch 22 that a quarter of a million Social Security beneficiaries forfeited $757 million in benefits in just the first seven months of this year because they continued to work. If you claim Social Security before reaching full retirement age and make more than $14,160, you'll lose $1 in benefits for every $2 you earn over that limit.

To make matters worse, the Social Security Administration doesn't trim each check by a proportional amount. Your benefits are withheld completely until the squeeze is satisfied.

There is a silver lining, though. Read Kevin's story to find out more.