Major rule changes could pose problems for some workers today.
Impact of government shutdown on social security
Here’s what you need to know about Social Security payments during the ongoing government shutdown.
Social Security is a source of income that millions of retirees rely on. Without these benefits, many seniors would have no way to pay for basic expenses such as housing, transportation, medical care, and food.
But whether you qualify for Social Security after retirement is not a given. Once you reach a certain age, you may think you’re eligible to enroll for benefits. However, to receive Social Security as a retiree, you typically must earn these benefits by working and paying into the system.
Remember, Social Security is primarily funded by payroll taxes. The whole reason benefit cuts are a topic of discussion is because the workforce is expected to shrink in the coming years as baby boomers retire in large numbers. Therefore, if you want to qualify for Social Security in the future, you usually have to contribute to the program in some way (although there are exceptions).
However, the rules regarding Social Security eligibility will change in 2026. And it’s important to understand what that means for you, especially if you’re only working part-time.
Big changes coming to Social Security work credits
In late October, the Social Security Administration announced a number of significant changes to the program. These include a 2.8% cost-of-living adjustment, raising the income test cap and expanding the wage cap.
Another announced change is an increase in the threshold for earning work units. Work credits allow you to collect Social Security benefits after your career ends.
Social Security requires workers to accumulate a total of 40 work units to be eligible for retirement benefits. Additionally, the maximum number of credits that can be earned in a year is 4 credits. This effectively means that you need to work in some form for at least 10 years to receive Social Security.
In 2025, one Social Security work credit is worth $1,810 of your income. But in 2026, the value of one labor credit increases to $1,890. This means that if you want to earn four work credits in 2026, you will need to earn at least $7,560.
If you work full time, this change probably won’t affect you. However, if you are working part-time, this is an opportunity to be careful about.
You should also know that the value of Social Security work credits can change from year to year. If you work part-time, be sure to monitor how the value of your work credits changes.
You can qualify for social security even without a work unit
In most cases, earning the appropriate number of work credits is the way to qualify for Social Security as a retiree. But it’s not your only path.
If your spouse or ex-spouse is eligible for benefits, you may be eligible for Social Security after retirement. Social Security spousal benefits can be up to 50% of the amount your spouse or ex-spouse would receive at full retirement age.
If your spouse or ex-spouse dies, you may be eligible to receive survivor benefits from Social Security. Minor children are also eligible to receive survivor benefits.
If you don’t earn enough to qualify for four work credits per year, you may be covering your expenses with someone else’s income, such as your spouse. And in that case, your spouse can easily qualify for Social Security based on their earnings history, and you’ll still be eligible for spousal benefits.
However, regardless of the situation, it’s important to understand the rules. Plus, you never know how the rules will change, so it’s best to stay informed about Social Security.
The Motley Fool has a disclosure policy.
The Motley Fool is a USA TODAY content partner providing financial news, analysis and commentary designed to help people take control of their financial lives. Its content is produced independently of USA TODAY.
