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How Does Working after Retirement Affect

Your Benefits (US)

NOTE: Information affecting your benefits in Canada and other countries will be added. Sign up to get the latest updates!—>

While many people look forward to their retirement to enjoy the fruits of their long-term work, there are those who take this opportunity to undertake a new endeavor and venture into a new industry.

Working after retirement could be as fulfilling as your first job; however, your income post-retirement could have a repercussion on your Social Security retirement benefits.

Some people choose to retire at a younger age than the full retirement age; however, earnings derived from employment after an early retirement may reduce the amount of benefits. (Important to Note: Retirement age for those born between January 2, 1943 and January 1, 1955 is 66 years).

  • If you have availed of early retirement age and have been employed following your retirement, your Social Security retirement benefit are deducted by $1 for every $2 you earn above the annual earnings limit. For the year 2015, the annual limit is set at $15,720.
  • By the year you reach the full retirement age though, your Social Security retirement benefit is deducted by $1 for every $3 you earn above the same limit. In the year 2015, the annual limit on earnings is set at $41,880. Note though that your earnings are counted only before the month you reach your full retirement age.

In the event that your earnings exceed the limit for the year but you will be retired for the part of the same year, there is a special rule that applies to your earnings for one year

When you reach the full retirement age, your earnings no longer reduce your benefits. This is regardless of the amount of your earnings. At this point, you benefits will be recalculated to leave out the months when benefits are reduced or withheld due to the excess in your earnings.

For those retirees who intend to work outside the United States, the rules for receiving your benefits while you are working overseas are different. There is another set of rules for working outside the U.S. after retirement.

Working after retirement is a right, while Social Security benefit is a privilege as it is a right as well. Knowing how your earning can affect your benefits is important to know how and when you can make the most out of the benefits you are entitled to in the first place. And of course, desiring to remain productive through endeavoring in a new industry after your retirement is always a choice.



Organization Specific Working After Retirement Info

KAPERS ORG Working After Retirement Proposal