[vc_row][vc_column width=”2/3″ el_class=”section section1″][vc_column_text]Working life doesn’t always end just because you are “retired” and more and more these days, people are continuing their working years long after careers end. Whether the intention is to help with transitioning, or because of financial reasons, a recent poll puts the number at a whopping 72 percent of people that are anticipating to continue working in some capacity after their official retirement.
For certain people, this may mean they can now look at jobs outside of their chosen fields and branch out into new areas of the workforce. So what can you do to prepare for this next chapter in your life and career?
The first step is to make sure you don’t go in blind. Planning is key.
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These are the questions you need to be asking yourself.
Generally speaking, there will be less available hours, and for less pay, now that you are not a full-time employee, so its important to make sure you have an emergency fund to cover any unforeseen expenses that may pop up as you first transition into retirement.
The same is true for benefits. Your retirement fund is probably going to be the only coverage you can expect, as part-time work also often comes with diminished benefit plans. If you are retired from full-time work, but your Medicare benefits haven’t begun, it might be a perilous time for you insurance-wise, with premiums going up as you become more responsible for your own coverage. Make sure to factor this into your living expenses as well.
The most important thing to remember though is this, if you can avoid dipping into your retirement accounts, you should.
Because partial retirement means you’ll still be managing an income, this is an ideal time to let those retirement accounts you have to marinate. By putting off any withdrawals from those accounts, you can avoid certain taxes (money grows pre-taxed in most IRAs) and fees (sometimes as high as 10 percent) that come with early withdrawals. The longer you wait to access that money, the more there will be there for you when you do!
So this all begs the question: if you’re partially retired but still working, when should you start collecting Social Security?
This all depends on your financial situation, of course, but there is certain information that may help in deciding whether it is the right time for you to collect or not.
First is your age. If you collect Social Security before the federally recognized retirement age of 62, you will see a reduction in benefits right off the bat. The earlier you start collecting, the greater the reduction will be. The reduction could possibly get even worse if you are still earning money through part-time work too, with $17,640 a year being the threshold after which your Social Security benefits might be affected. This is the main reason to put off collecting until you’ve stopped working completely.
In summation, with a few steps, you should be able to keep working and making money even after you’ve retired from full-time work as long as you plan your financial future ahead of time, and know-how and when to start pulling from Social Security. Financial advisors should be able to help with any further questions you may have.[/vc_column_text][/vc_column][vc_column width=”1/3″][vc_single_image image=”36673″ img_size=”292×285″ style=”vc_box_shadow”][/vc_column][/vc_row]
