What to Do if Your Social Security Credits Fall Short
Some people may assume that once Social Security taxes have been deducted from their paychecks, they will automatically be eligible to receive a retirement benefit.
But eligibility is not attained simply by starting to pay into the program. Workers must accumulate a minimum number of Social Security credits before they can collect retirement benefits on their own earnings record.
This can create an unpleasant surprise for immigrants, people who spent only part of their careers in the United States, workers who moved in and out of covered employment and those who stopped working earlier than expected.
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The good news is that falling short of the standard requirement does not always mean the Social Security taxes you paid will produce no benefit. Depending on your age, marital history, future work plans and employment in another country, several options may still be available.
Understanding the 40-credit requirement
A credit is the basic unit for determining whether a worker is insured under the Social Security program. To be eligible to collect retirement benefits, a worker must have earned enough income, subject to FICA or SECA payroll tax contributions, to have received 40 credits.
Each credit is earned by a dollar amount and not specific to when it is earned in the calendar year.
In 2026, the amount of earnings required for one credit is $1,890. Therefore, to earn all four credits in 2026, a worker must earn and pay FICA or SECA taxes on at least $7,560 of gross income or net income if they’re self-employed.
No matter how high the earnings may be, only up to four credits may be earned in one year.
If a person earns a lower amount than $7,560 in 2026, they will earn fewer credits. A person earning $7,560 and another earning $100,000 would each receive four credits for the year.
As an example, let’s consider a worker who expects to earn $3,900 in 2026. This person will earn two credits in 2026. This is determined as follows: $3,900 ÷ $1,890 = 2.06 → 2 credits
A credit is never rounded up since the dollar amount of the next quarter has not been met. Only full quarters of coverage can be earned.
Credits determine only whether you are insured for benefits; they do not directly determine the size of your Social Security benefit.
You may be able to earn the missing credits
Social Security credits remain on your earnings record permanently. They do not expire simply because you stop working, leave the United States or take a job that is not covered by Social Security.
A person with 36 credits, for example, could earn the remaining four credits through one additional year of covered employment. Because credits are based on annual earnings, the person would not necessarily need to work for the entire year.
Before making employment decisions, all workers, of any age, should review their official earnings history through their personal my Social Security account at SSA. Missing or incorrectly reported earnings could affect both the number of credits and future benefit amounts.
SSA recommends regularly checking the earnings record and requesting corrections when necessary.
Workers should also confirm that their current employment is covered by Social Security. Most private-sector employment is covered, but certain state and local government positions, foreign employment and other specialized work arrangements may operate under different rules.
You might qualify on someone else’s record
Social Security offers benefits to dependents of a worker as well. A person does not need 40 credits on their own record to potentially receive a benefit as a spouse, divorced spouse, widow or widower.
For example, someone who is married to a worker receiving Social Security retirement or disability benefits may qualify for spousal benefits, generally beginning at age 62. At full retirement age (FRA), the maximum spousal benefit may equal as much as 50% of the worker’s FRA benefit. Claiming before FRA will result in a permanent reduction of the spousal benefit.
A divorced person may potentially qualify on a former spouse’s record if the marriage lasted at least 10 years, and the other eligibility requirements are met. Survivor benefits may also be available to qualifying widows, widowers and surviving divorced spouses.
All these benefits are based on the worker’s insured status, so the spouse or former spouse does not have to independently earn 40 credits.
The rules for disability and survivor protection are also different from the standard retirement rules. Younger workers may qualify for Social Security Disability Insurance (SSDI) with fewer than 40 credits, although they must generally satisfy both a total-work and recent-work requirement.
Likewise, the number of credits required to provide survivor protection depends partly on the worker’s age at death.
In certain cases, as few as six recent credits may provide benefits for surviving children and a spouse caring for those children.
What happens to the Social Security payroll tax contributions already paid?
Social Security is a social insurance program, not an individual investment account in which each person’s payroll taxes are held separately.
As such, Social Security taxes paid by employees and employers into the Old-Age, Survivor Disability (OASDI) trust fund and Hospital Insurance (HI), or Medicare, trust fund cannot be refunded merely because a worker has not accumulated enough credits to qualify for benefits from these funds.
This makes it particularly important to identify possible eligibility through additional work, family benefits or international coverage before assuming the contributions will never produce a benefit.
Worked in another country? A totalization agreement may help
The U.S. has bilateral Social Security agreements, commonly called totalization agreements, with numerous countries, including Canada, the United Kingdom, Germany, France, Italy, Australia, Japan, South Korea, Brazil and others.
These agreements serve two primary purposes:
- They help prevent workers and employers from paying Social Security taxes to two countries on the same earnings
- They also help people who divided their careers between the U.S. and another country qualify for benefits when they lack sufficient coverage under either system alone
For U.S. benefits, a worker generally must have at least six U.S. Social Security credits before foreign coverage can be considered. The foreign credits do not become U.S. credits. Instead, the two countries’ coverage periods may be combined to establish eligibility.
If the combined record qualifies the worker for a U.S. benefit, the SSA calculates a partial, or prorated, benefit reflecting the portion of the worker’s career covered under the U.S. system. The foreign country may separately determine whether the person qualifies for a benefit under its laws.
A worker who already has enough U.S. credits to qualify without foreign coverage generally receives a regular U.S. benefit rather than a totalization benefit.
Review and prepare before retirement
Anyone who has worked in the U.S. for fewer than 10 years should review their Social Security earnings record in detail well before retirement. They can then determine how many credits are on their record, whether any earnings are missing and how many additional credits could realistically be earned.
Considering all options is critical:
- Are spousal, ex-spouse or survivor benefits available?
- Was part of the career spent in a country with a U.S. totalization agreement?
- Could another year or two of covered work secure insured status?
Coming up short of 40 credits may limit the options, but it does not always end the conversation. A careful review of the worker’s complete employment and marital history can uncover benefits that might otherwise be overlooked.
