Working part-time

Working in Retirement

Many people choose to transition slowly to retirement and work part-time before fully retiring. If you prefer more free time, but also want a source of extra cash, part-time work, also known as bridge employment, may be a viable option.
For many transitioning retirees, bridge employment not only provides some income, but also slows the depletion of savings. Along with the clear financial benefits of finding a part-time position, there are also physical, mental, and emotional rewards to staying connected with colleagues as well.
Working part-time can mean a lot of things: transitioning to a part-time role in your current company, moving to another job within your field, or pursuing a new career path altogether.

Benefits of working part-time

Many retirees have a hard time adjusting to an unstructured lifestyle. Working part-time on something you care about will ease the transition and help provide a sense of purpose.1
Retirees that work part-time have been shown to have better physical and mental health.1 Additionally, working affects emotional health in a positive way, especially when an employee feels challenged by the nature of the work or makes new social connections.
Another benefit of part-time work is the chance to be covered under the company’s health insurance. This is especially helpful if you’re younger than 65 (and thus do not yet qualify for Medicare).

Choosing a part-time job

When choosing a part-time position, there are a few avenues to explore. In addition to looking within your current company and asking your manager about part-time opportunities, you may want to research available positions on job recruitment sites or consider learning new skills to expand your skill set. You could also look for consulting opportunities in your current field or even start a new business. If you have a passion you weren’t able to pursue earlier in life because it didn’t pay enough, now could be the time to take on a part-time position in that field or area of interest.

Social Security implications

You can still work while receiving Social Security retirement benefits, but the benefits you receive may be altered if you haven’t yet reached full retirement age (between 66 and 67 depending on the year you were born). See below for more details:
Social Security implications chart
Earnings subject to withholdings include gross wages from an employer, self-employed earnings, and other work-related income, such as bonuses, commissions and fees. Investment income is not included. These withheld benefits are temporary reductions, and once you reach full retirement age, your benefits will increase to account for the withholdings.
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1 14 Reasons Why Retirement Jobs Are The Best! June 21, 2016, NewRetirement.com. https://www.newretirement.com/retirement/retirement-jobs/
 
2 The 2016 Retirement Confidence Survey: Worker Confidence Stable, Retiree Confidence Continues to Increase, March 2016. https://www.ebri.org/pdf/briefspdf/ebri_ib_422.mar16.rcs.pdf
 
3 Exempt Amounts Under the Earnings Test, 3-16-17, Official Social Security Website - http://www.ssa.gov/oact/cola/rtea.html
 
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