Working after retirement isn’t such a bad idea for some people. There are a lot of reasons why someone might choose to work after they have retired. A part-time job is a great way to keep you busy and can also help bring in extra money to ensure that you have enough to live on.
Saving More Money
If you choose to work a part time job after you retire you can use that income to reduce the amount that you withdraw from your IRA, and this can allow your investment to grow. For example, if your part time job brings in $15,000 a year, you can withdraw that much less from your IRA. If you were to do this for 10 years and get tax-deferred growth at 8%, you would actually have over $200,000 more in your IRA.
Increasing the amount of money that you have in your IRA, can help to ensure that you have enough money to last you for the rest of your life, especially in the later years when you may not be able to work anymore.
Social Security Benefits and Working
Keep in mind that any income you earn after retirement can affect your Social Security benefits, depending upon how old you are when you start.
Those that retire between the age of 62 and full retirement age, which is determined by the year you were born, will have their benefits reduced by $1 for every $2 they make above the annual income limit. That limit is currently $14,160 a year.
If you were to work a part time job, chances are it would not have much affect on your Social Security payments. Once you do reach full retirement age, you can earn as much money as you want and it will not reduce your Social Security payments.
Health Insurance
Having some type of health insurance is another reason why some people choose to continue working after they have officially retired; this is especially true if they take an early retirement and are not yet qualified to receive Medicare.
The bottom line is that there are a number of reasons why working after retirement can be beneficial, both financially and otherwise. Ideally though, you’ll want to be in a position where any work you do is for the pleasure of the task and not because you are in need of money. To make sure you have enough to live on after retirement, you should consult with a financial planner to help you map out your retirement income.
Anthony Moccia is an attorney and partner at The Law Offices of Kobrick & Moccia.His practice focuses on estate planning and elder law.He is a member of the New York State and Nassau County Bar Associations.He frequently presents free seminars on wills & living trusts to area residents and his seminars are said to be “informative, entertaining & easy to understand.” Latest posts by Anthony Moccia (see all) - “Last Will and Testament” Origin - April 1, 2021
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- “Last Will and Testament” Origin - April 1, 2021
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