Key takeaways

  • Working after retirement can provide structure, keep you sharp mentally and socially, and bring in extra income.

  • Before starting a job after retiring, consider whether it aligns with and supports your retirement goals.

  • Earning income during retirement could affect your Social Security and tax status, so it’s best to consult a financial professional before you make the leap.

Many would-be retirees are pleasantly surprised to learn that retirement doesn’t have to mean that you stop working completely. In fact, the prospect of a post-retirement career can be appealing for many different reasons. There are the obvious financial benefits, of course, but it’s also a chance to explore that second career or passion project that’s been on the backburner.

Before you dive into a post-retirement career there are some financial points to consider, including how it will impact your Social Security benefits, taxes and healthcare coverage. This article highlights the pros and cons of working post-retirement plus the top financial considerations to factor in when planning your encore career move.

 

What are the pros and cons of working after retirement?

People choose to keep working past retirement age for a lot of different reasons, and many of them are personal in nature.

For example, sinking your teeth into a new career, job role or business opportunity can provide a sense of purpose and fulfillment that you might not get on the golf course. It can also help you stay intellectually engaged and socially connected, both of which are important at any age.

Working may also help ward off issues like cognitive decline, helping keep your mind sharp. It can give structure to your day, which can be particularly beneficial in early retirement. And if you choose an occupation like mentoring young professionals or volunteering in your community, it allows you to contribute to a worthy cause. These are just some of the nonfinancial benefits that go beyond income supplementation.

“Finding a second career that you enjoy can help you reengage, stay active and reestablish the social bonds that may have drifted away when you retired.”

Ryan Peters, Senior Wealth Planner, U.S. Bank Private Wealth Management.

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