What Are Work Credits?
What Are Work Credits?
Work credits are units of measurement that the Social Security Administration (SSA) uses to determine eligibility for its retirement, disability, and survivor benefits. They are earned through work and are based on the amount of income a person earns. The more work credits a person has, the higher their monthly benefit amount will be.
How Work Credits Work
To earn one work credit, a person must earn $1,510 in 2023. Up to four work credits can be earned in a year, regardless of how much a person earns.
The number of work credits required to qualify for Social Security benefits varies depending on the type of benefit and the person's age when they become disabled or retire. For example, a person who becomes disabled at age 62 needs 40 work credits to qualify for disability benefits. A person who retires at age 67 needs 68 work credits to qualify for full retirement benefits.
| Work Credit Amount | Earned Income |
|---|---|
| 1 | $1,510 |
| 2 | $3,020 |
| 3 | $4,530 |
| 4 | $6,040 |
| Age | Retirement Work Credits | Disability Work Credits |
|---|---|---|
| 62 | 40 | 20 |
| 67 | 68 | 40 |
| 70 | 70 | N/A |
Success Stories
- A 65-year-old woman who earned $50,000 per year for the past 20 years will have earned 80 work credits. She will be eligible for full retirement benefits when she reaches age 67.
- A 55-year-old man who has been disabled for the past 10 years will have earned 20 work credits. He will be eligible for disability benefits when he reaches age 62.
- A 50-year-old woman who is a widow will have earned 10 work credits if her husband earned $60,000 per year for the past 10 years. She will be eligible for survivor benefits when her husband dies.
Why Work Credits Matter
Work credits are important because they determine eligibility for Social Security benefits. Without enough work credits, a person may not be able to receive any benefits at all. It is important to start earning work credits as early as possible to ensure that you will have enough credits to qualify for benefits when you need them.
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