After a lifetime of labor, the historic day has finally arrived. The “big day” is your last official day on the job. You are 65 years-young and ready to enjoy your golden years, sipping umbrella-laden drinks on a tropical beach. While this sounds like a great plan, it is far from a reality for many seniors. Over the past few years, many retirees are leaving retirement behind, returning to the job market for four decidedly different reasons.
1. Lack of planning
Many seniors rely on pretax contributions paid into Social Security and Medicare over their lifetimes, believing these programs are a safety net when it comes to collecting steady retirement income after age 65. Because these folks counted on these safety nets, they neglected to save anything extra in their early years; they have no 401K, no IRA and no pension to fall back on. For these seniors, returning to work is required for survival when Social Security checks alone will not cut it.
2. Outliving their savings
Other seniors are outliving their savings thanks to inflation costs and increased health care expenses. These seniors planned for retirement, and believed they planned well, only to find out that their money is rapidly disappearing at an alarming rate. For these seniors, monthly Social Security stipends are not sufficient in order to restore ever-decreasing coffers. Each month, the senior watches as his balance drops, because he is operating at a deficit. As his income dwindles, he realizes he has no other choice but to re-enter the workforce.
Some seniors find that Medicare and its supplement programs do not provide adequate financial coverage or help for additional health problems and required prescriptions. These retirees will re-enter the labor force to take advantage of supplemental health care benefits and insurance plans otherwise unavailable to them.
4. To stay alert and active
Some seniors simply do not want to retire. They are passionate and feel as if they have a lot left to give in the workplace. These seniors feel working helps them to stay alert, active and in tune with society. For some of these retirees, post retirement employment gives them the option to explore a career they were always interested in, but could not pursue when they were younger.
No matter the reason, it is vital for retirees to realize that going back to work can affect Social Security and Medicare benefits in several different ways. Retirees returning to the work force need to make sure they understand any potential repercussions before taking the leap.