Social Security and Living Abroad

Welcome to the next article in our retire-abroad series. Now that you’ve learned the considerations for retiring abroad, you are ready to dive deeper on a few key topics. In this article, we will address some common questions about receiving Social Security benefits while retired abroad. The high-level information we discuss below is specific to U.S. citizens who are primary recipients of Social Security Benefits. You should review the full detailed information provided by the U.S. Social Security Administration (SSA) to learn more about the topics we discuss, and to understand other factors which may apply to your particular situation.

In this article, we address the following questions about Social Security and living abroad:

Table of Contents

• Can you collect Social Security while retired abroad?
• What does the Social Security Administration consider “outside of the country”?
• What is the impact of working while retired abroad on Social Security benefits?
• What is the Social Security ‘foreign work test’?
• What is the Social Security ‘retirement earnings test’?

Can you collect social security and live in another country?

Most likely. If you’re a U.S. citizen eligible to receive Social Security payments, you can receive them outside the U.S. as long as you are not residing in a disallowed country. Disallowed countries generally include North Korea, Cuba, Azerbaijan, Belarus, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. Exceptions may apply. You can receive Social Security payments in many popular retirement destinations including Portugal, Spain, Mexico, Canada, Panama, Uruguay, Costa Rica, Ecuador, Greece, Malaysia, France, and Columbia among others. The U.S. Social Security Administration provides a Payments Abroad Screening Tool which you can use to determine whether you are eligible for payments abroad. They also provide a document with full details on how living abroad may impact your ability to receive Social Security payments: Your Payments While You Are Outside the United States.

For the purpose of receiving Social Security benefits, what constitutes being outside of the United States?

The SSA considers you to be outside of the country if you are outside of U.S. states and territories* for at least 30 days in a row. The SSA considers you to have returned to the country once you have returned to a U.S. state or territory* for at least 30 days in a row.

* 50 states, District of Columbia, Puerto Rico, U.S. Virgin Islands, Guam, Northern Mariana Islands, American Samoa

How does working or owning a business while retired abroad affect my Social Security benefits?

You are required to notify the SSA if you’re receiving Social Security benefits, are younger than full retirement age, and intend to work or own a business outside of the U.S. This applies even if you:

• Only work part time.
• Are exempt from U.S. Social Security taxes because of an international agreement.
• Have an agreement to work but do not actually work any hours.
• Own or partly own a business even if you don’t work in the business and do not make any income from it.

Failure to comply can result in a reduction or loss of benefits. You can review the full details here: How Work Affects Your Benefits.

What is the Social Security ‘foreign work test‘, and how might it impact me as a U.S. citizen retired abroad?

The foreign work test places an upper limit on the hours a Social Security beneficiary can work outside of the U.S. without losing their monthly benefit. If you’re a U.S. citizen receiving Social Security benefits and are younger than full retirement age, the Social Security Administration will withhold your benefits for each month that you work more than 45 hours outside of the U.S. and are not subject to U.S. Social Security taxes. Note that this applies even if you are exempt from U.S. Social Security taxes because of an international Social Security agreement. The foreign work test does not apply if you are paying Social Security taxes while receiving benefits. Read the full details about the foreign work test here: The Foreign Work Test.

What is the Social Security ‘retirement earnings test (RET)‘, and how might it impact me as a U.S. citizen retiring abroad?

The retirement earnings test places an upper limit on the annual work-related earnings* a Social Security beneficiary younger than full retirement age can earn without having their Social Security benefits withheld. The RET applies whether you are working inside the U.S. or while retired abroad. Note that benefits withheld due to RET are not lost. Any benefits withheld result in increased benefits once the beneficiary reaches full retirement age.

* Income from government benefits, investment earnings, interest, pensions, annuities, and capital gains are not considered work-related income for the purpose of this test.

That’s it for our discussion on some of the most common questions around Social Security and living abroad. I hope that this information was useful, and helped you move forward toward your goal of retiring abroad. As a reminder, Weathered Wisdom and its authors ARE NOT Social Security experts. While we have made every attempt to present accurate information, the author is only human, and the information may not be appropriate for your particular circumstances.  Information may also become outdated over time.