Many people who continue working after retirement aren’t motivated to do so out of boredom or a fear they’ll run out of money, they are making a strategic financial decision. Waiting to take full retirement and continuing to work in some capacity will ensure your lifestyle is maintained, essential expenses are covered, and your emergency savings and investments continue to grow.
Beginning the month you reach full retirement age; you will be able to work as much as you want, and your benefits will not be reduced. If you retire early and continue to work your benefits will be reduced if you make more than the yearly earnings limit. If you decide to delay taking retirement, your benefits will increase for each month you don’t receive them until age 70. Studies have shown that “delaying retirement by 3-6 months has the same impact on a person’s retirement standard of living as saving an additional 1 percentage point of salary for 30 years”.
An added benefit to continuing to work after retirement age is improved physical and mental health. Going to work provides a social outlet that many retirees struggle to find after leaving the workplace. WebMD found that older adults who work part-time after retirement have fewer serious diseases like cancer, high blood pressure, diabetes, heart attack and stroke.
If you are unsure when to claim your Social Security benefits or how much you can earn after you are retired, contact Alloy Wealth Management. There are tax consequences to earning income in retirement and one of our fiduciaries will work with you to create a comprehensive retirement plan that fits your lifestyle goals and timeline. Call 800-689-3935 to schedule an appointment.