Not everyone is ready to throw in the towel when they hit retirement age. But what happens to your retirement benefits like Social Security and Medicare if you keep on working instead of officially retiring? Maggi Tax has the answers! If you’re looking for retirement planning services near you like Social Security or Medicare planning, be sure to contact our team for a consultation.
Why Seniors Would Rather Work Than Retire
Is the economy so bad that even the elderly feel the need to keep working to make ends meet? Some may think that way, but that’s not always the case. There are plenty of energetic individuals who find comfort in staying busy with work or those who simply take pride in what they do. Not everyone can imagine a peaceful life sitting around the house all day, and vacationing may not be their style. No matter the reason, there’s nothing wrong with having a strong work ethic! But how can working during your retirement phase affect the Social Security and Medicare benefits that you’ve been contributing to this whole time through good-ol’ tax-paying?
Thankfully, the land of the free rewards you for your efforts by giving you additional benefits for working in retirement. Navigating the complexities of this situation, though, is key to truly enjoying the benefits that could be coming your way.
How Social Security Works While You’re Still Employed
Social Security while employed in retirement is sort of like a “pay now, reap the rewards later” situation. Before you reach full retirement age, you will pay a calculated amount based on your earnings over a set limit. During the tax year you hit full retirement age but before the months leading to your birthday, the amount you pay may end up being a dollar for every three dollars that you make over that limit. Once your birthday rolls around, that’s when you start enjoying your hard-earned reward.
When you reach full retirement age, there will be no limit to your earned wages and any amount that you earn will not reduce the Social Security benefits that you are owed.
Read our Social Security FAQ page to learn more about retirement benefits.
At Maggi Tax, we offer Social Security planning services to help you make the most out of your retirement benefits. Meet with our financial advisors to get started!
| When Is Full Retirement Age?
If you were born before 1960, your full retirement age would be 66. The additional number of months you may have to wait past age 66 may differ depending on the exact year you were born. If you were born in 1960 or later, your full retirement age is 67. |
Navigating Medicare Premiums While Working In Retirement
Medicare coverage is where things get a little tricky for those choosing to work in retirement. That’s because your insurance coverage is potentially coming from two outlets: Your retirement benefits and your employer. Taking the right steps will ensure that you receive assistance from either side.
You can receive free healthcare through Medicare Part A if you are over 65 and have worked for at least 10 years (while paying Medicare taxes). By enrolling in Medicare Part A, your employer’s insurance and Medicare may work together to help you pay for your medical services.
Keep in mind that if you have been working in retirement for some time, you will have eight months to sign up for Medicare Plan B if you choose to quit your job at any point.
With so many rules and stipulations regarding Medicare, it’s a good idea to meet with your trusted financial advisors for Medicare planning services near you!
Get More Answers On This Complex Topic at Maggi Tax!
If the topic of retirement benefits while working in retirement still feels foreign to you, we can help you with retirement planning at Maggi Tax! Give our team of financial advisors a call today at (727) 799-1701 to schedule a consultation.
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