senior woman working in greenhouse holding plant

Should you continue to work a part time job?

There comes a time in just about every retired person's life when they have gotten all those projects on their to-do list done. They have enjoyed those long, leisurely mornings over coffee and the newspaper and they have done all the traveling that they want to do right now. For many retirees, it is time to get back to work.

Many Americans of retirement age must continue working in order to cover their necessities. For other retirees, this time is different. Perhaps you don't have to worry about saving for retirement or the kids' college. Maybe you don't really need the money, but you do need the stimulation, a regular schedule, the identity, and the interaction with the people you would meet on a job. This time you can do something that you enjoy on a schedule that works for you.

Perhaps a Part-Time Job 

Many retirees find satisfaction working part-time for someone else in businesses related to their hobbies or interests. Such jobs may be found in employment ads or just by asking business owners if they could use a dependable, mature employee. Other retirees pursue a second career where they can use the skills and experience that they gained in their business careers, in a home-based business that allows them to set their own schedules, not have to commute, work as much as they want while doing something that they enjoy.

How About a Home-Based Business?

The lure of owning a home-based business after retirement can be very tempting for some. After all, the idea of living in an active retirement community and enjoying a vibrant lifestyle while still keeping busy with a business on the side has many baby boomers rethinking retirement.

There are a few issues to consider before starting a new business. Steve Strauss, an expert on small businesses, cautions: "starting a new business when you are older is more risky than when you are younger. When you are younger, you can afford to make a mistake, go out of business, even file for bankruptcy and still rebound. When you are older, there is simply less time to bounce back from significant business problems. Moreover, when you are older, the money you have to invest in the venture might just be the retirement assets you worked so hard creating. Betting your nest egg on an untried business venture may not be the best idea."

In his book "How to start a new business after retirement," Strauss suggests four rules to follow:

  1. Don't bet the ranch.
  2. Pick a business you know well.
  3. Consider buying an established business.
  4. Consider a franchise.

Another issue to consider before re-entering the workforce is any reduction that might occur in your retirement benefits. There is a formula that the Social Security Administration uses to determine how much your benefit must be reduced:

  • If you are under full retirement age for the entire year, we deduct $1 from your benefit payments for every $2 you earn above the annual limit.
  • In the year you reach full retirement age, we deduct $1 in benefits for every $3 you earn above a different limit, but we only count earnings before the month you reach your full retirement age.
  • Starting with the month you reach full retirement age, you can get your benefits with no limit on your earnings.

After considering the negatives, if you still want to go back to work, then by all means, do so. Often the positives will help you feel productive, engaged, vigorous, and happier. After all, being happy after retirement was why you worked so hard all those years in the first place.