Working after 70 and Social Security: the benefit bump has a catch

A worker who is still in high-earning mode after 70 may see a Social Security bump, but MarketWatch’s Quentin Fottrell says there is a costly line to watch: working after 70 Social Security rules do not reward people for delaying benefits past that age.

The question came from a reader of MarketWatch’s The Moneyist column who planned to wait until 70 to claim Social Security, then keep working until the end of the tax year, roughly 10 months after turning 70. The reader also asked how retirement would affect Medicare premiums tied to earlier income.

Fottrell’s answer: extra pay can help if it ranks among the worker’s top earning years, because the Social Security Administration reviews earnings annually and can recalculate benefits when a new year replaces a lower-earning year in the 35-year formula.

The catch is blunt. Fottrell wrote that delayed retirement credits stop at 70, so waiting beyond that age does not add another reward to the monthly check. If someone does not claim at 70, the monthly benefits they could have received after that birthday are generally gone.

Will working after 70 increase Social Security?

It can, if the new wages are high enough to replace one of the 35 years currently used in the benefit calculation, according to Fottrell. Social Security benefits are based on a worker’s 35 highest-earning years, and the agency automatically checks for updates each year.

That does not mean every extra dollar counts. Fottrell noted that in 2026, $184,500 is the maximum amount of annual income subject to Social Security payroll tax. Earnings above that level are not taxed for Social Security and do not raise future Social Security benefits.

For workers who waited to claim, age 70 is still the big stop sign. Delaying after full retirement age, listed by Fottrell as 67, can raise monthly benefits by about 8% a year and produce payments up to 30% higher than claiming at full retirement age. After 70, that bonus meter stops running.

Fottrell advised applying for benefits as early as four months before turning 70 to reduce the risk of processing delays. Social Security payments are made one month behind, and payment timing depends on the beneficiary’s birth date.

What about Medicare and IRMAA after retirement?

The reader also asked about Medicare’s income-related monthly adjustment amount, known as IRMAA, because a high income before retirement can raise Medicare Part B and Part D premiums later. Fottrell wrote that IRMAA is based on modified adjusted gross income from two years earlier.

Retirement can qualify as a life-changing event for an IRMAA review. Fottrell said retirees can ask the Social Security Administration for a new determination by filing Form SSA-44, Medicare IRMAA Life-Changing Event, along with documentation such as proof of retirement and an estimate of the new income level.

Fottrell wrote that Medicare’s IRMAA thresholds are tiered. For 2026, he said the maximum IRMAA surcharge for a married couple in the highest bracket is about $6,936 per person per year, or $13,872 for the couple. He also noted that some retirees may face the 3.8% net investment income tax on investment earnings.

Medicare enrollment timing matters, too. According to Fottrell, people already receiving Social Security are usually enrolled in Medicare automatically. Those who delayed Social Security while covered by an employer plan often must enroll themselves when that coverage ends.

If the employer has 20 or more workers, Fottrell wrote, an employee can generally postpone Part B without a penalty. Once employment or employer coverage ends, the retiree should use the Special Enrollment Period and make sure Medicare starts before employer insurance disappears.

This story draws on original reporting from MarketWatch.