It's Getting Harder to Qualify for Social Security. Here's Why.

One of the biggest misconceptions around Social Security is that everyone is entitled to it once they reach a certain age. In reality, Social Security is something you earn -- specifically, by paying into the program through taxes on your wages.

To qualify for Social Security benefits in retirement, you need to accrue 40 work credits in your lifetime. And you can earn a maximum of four credits per year.

This year, $1,640 of earnings will render you eligible for a single work credit. But next year, it will take $1,730 to qualify for a work credit. And that's an important detail to keep in mind if you work on a very part-time basis.

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Make sure you're earning enough

People who work on a full-time basis generally don't have to worry about not earning enough to accrue four Social Security work credits in a year. The federal minimum wage is $7.25 an hour. That's $290 a week for a 40-hour workweek, and $14,500 a year, assuming 50 weeks of work.

Meanwhile, it takes earnings of $6,920 to accrue four Social Security work credits in 2024. So while minimum wage earners might have their share of financial struggles to grapple with, those who work full-time on that pay scale can still snag the maximum number of work credits.

However, if you're someone who works pretty part-time, then it pays to be mindful of your earnings and hours in 2024 if your goal is to set yourself up with a regular Social Security benefit for retirement. The good news, though, is that any money you earn and pay taxes on counts for Social Security purposes. So if you decide to ramp up your income by joining the gig economy, those earnings count as long as they're reported and taxed.

There are other ways to become eligible for Social Security

Many people end up filing for Social Security benefits in retirement based on their own wage histories. But if you don't end up accumulating enough work credits to qualify for benefits on your own, you might still have the option to collect Social Security.

If you're married to someone who's entitled to Social Security, you can generally sign up for spousal benefits, which will give you 50% of what your spouse collects each month. If you're divorced, you may also be entitled to spousal benefits from Social Security based on your ex-spouse's record.

Stay apprised of changes

There are a number of Social Security rules that are changing in 2024, including the amount of earnings it takes to score a work credit. It pays to read up on changes to the program even if you're not collecting benefits. You might be impacted by updates even if you're many years away from reaching retirement age.

For example, next year's Social Security wage cap is rising so that higher earners will be forced to pay taxes on more of their income. If you're someone who's worried you'll barely earn the $6,920 needed to receive four work credits, then that's not a change that will impact you. But it's good to be in the know nonetheless.

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