It Pays to Work in Retirement — Despite the Drawbacks Involved

There are some less obvious benefits you may not be aware of.

You’ll often hear that working in retirement is a mixed bag, financially speaking. On the one hand, you get to earn money that can boost your retirement income and give more spending power. That’s a good thing. The bad thing, however, is that the more you earn, the higher your tax burden becomes. And also, the higher your income, the greater your chances of being taxed on some of your Social Security benefits. Plus, if you work and file for Social Security before reaching full retirement age, you’ll risk having some of those benefits withheld if your earnings exceed a certain threshold. So all told, it’s easy to make the case to avoid holding down a job once you declare your retirement official. But while working in retirement may result in a few unwanted financial surprises, it pays to hold down a job nonetheless. And the reason actually has nothing to do with money.

It’s all about your mental health and physical wellbeing

Collecting a paycheck is an obvious perk associated with working in retirement. But income aside, holding down a job could offer a world of benefits you may not have thought about. For one thing, work could serve as a social outlet for you. And that’s important, because retirement can be an isolating period of life. If you’re used to reporting to an office and being social, you might miss that routine once your career wraps up. And if you don’t have a decent number of fellow retirees to do activities with, you might quickly get lonely. A part-time job in retirement could solve that issue. Also, retirees often find themselves bored and uninspired in the absence of a steady routine. Working could give you the structure you need, all the while giving you a way to fill some hours of the day. Finally, when you don’t have a job to report to, it can be easy enough to hunker down at home and start leading a more sedentary lifestyle. But that could be harmful to your physical health. If you push yourself to work in retirement, it could give you a reason to leave the house and get moving. And that could result in fewer health issues and lower healthcare costs.

A move worth making

Some people insist that after a lifetime of hard work, the last thing they want to do in retirement is hold down a job. But remember, if you don’t have a pressing need for money, you’ll have the freedom to take on any type of job you like, even if it means making $9 an hour serving cake at a bakery or $10 an hour caring for dogs. And so the job you end up with might feel more like another leisure activity than actual work. All told, retirees often fall victim to mental health issues when they stop having a place to go regularly. A part-time job could fill that void. So even if your income doesn’t need a boost, it pays to consider working in some capacity once your main career wraps up.