There are plenty of people in the world who absolutely love their job. In fact, we should each strive to find employment in an area that we find personally rewarding. Whether you love your job or simply go through the motions for a paycheck, the fact remains that the vast majority of individuals dream of the day when they will no longer “have” to work. Some people actively plan for an early retirement while others find themselves retiring early for unexpected reasons. Early retirement can be a great thing if you are financially prepared for that step. For those who retire early and find themselves struggling to meet their financial obligations, there is often a need to re-enter the workforce to make ends meet. The following tips can help those who find themselves going back to work after an early retirement.
How to handle Social Security?
If you retired prior to what Social Security considers your “full retirement age”, and have already started receiving benefits, you may think a retirement do-over is out of the question. Fortunately you are in luck and it is possible to go back to work after you have received Social Security benefits while increasing your Social Security benefits. In order to gain the maximum Social Security benefits, you must begin taking benefits at or after your full retirement age (currently 66 or 67 depending on the year of your birth). If you have already received benefits you can drop your claim and repay the amount you have received- which will allow you to re-apply at your full retirement age and qualify for a higher benefit amount each month.
Saving for retirement.
If you are going back to work due to a shortage of money, it is important to recognize where you can save more money for your remaining years. Investment strategies this close to actual retirement should be on the conservative side with minimal risk. Many individuals find the Roth IRA a great investment tool at all ages, especially closer to retirement as there are fewer restrictions than those applied to other accounts. For example, an individual is not limited to contributing to a Roth IRA until age 70 1/2 and there are also no minimum mandatory distributions to content with once you reach that age.
Readjusting to work.
Depending on how long you have been in retirement, it may take a bit of time to re-adjust upon re-entry to the work force. Before you make the leap, consider updating your resume and possibly discussing your move with a career advisor. They may be able to help you pinpoint where your skills will best be utilized as well as helping find the right job. Many ex-retirees find that re-entering the work force is not as difficult as they might have imagined. Others are reminded of the fulfillment that comes from a good day’s work. Regardless of the circumstances that have brought you out of retirement, it is important to take advantage of this additional opportunity to earn and save for the years to come.