Seniors are facing an interesting, albeit challenging, decision today — should they return to work?
Thanks to the pandemic and record high inflation, many seniors were either forced to retire or retired earlier than expected. This resulted in retirees having trouble prolonging any retirement savings. All of that put together has created the half-retirement phenomenon, as seniors look to make extra income to support themselves and their retirements.
Luckily, seniors looking to return to work might be surprised by the amount of job opportunities waiting for them and how their benefits are effected, CNBC’s Lorie Konish reports.
Senior Job Opportunities
According to the All-American Work Survey, 68 percent of American seniors have or are considering returning to work. Forty-two percent of seniors also stated they intend to work and claim Social Security benefits at the same time. Despite inflation slowing the economy, one economic area that has remained surprisingly steady is the unemployment rate. For every available worker, there is an estimated 1.8 jobs.
One thing to take into consideration when thinking of returning to work is how it may affect your benefits. It’s possible to earn an income and claim benefits at the same time, and you can even use your new earnings to boost your benefits.
But be aware that benefits will be penalized, however, if you are under your full retirement age.
Your benefit is calculated based on your income from 35 of your highest grossing working years. If going back to work means you can earn a higher income, and have you benefit recalculate to incorporate your new earnings, it may raise your benefit. Weigh that amount against any temporary penalty if you’re below your full retirement age. If you’re about full retirement age, then earn as much as you want.
If you make more in the long run, then that’s a good indication it might make more sense to return to work, for the time being.
For more Social Security news, follow along with the Council for Retirement Security.