The Benefits of Working Part-Time During Retirement
You can actually still work during retirement and earn an income. There are several benefits in working part-time in retirement, however doing your research first is a must. Here’s a guide to help you work out what the best options are for you.
The Benefits of Working Part-Time
Many retirees self-fund their retirement. This means that fewer people are dependent on the aged pension and other government subsidies. As compulsory superannuation didn’t come into effect until 1992, there are many people who can’t rely on their superannuation alone. Consequently, many people have to make serious decisions regarding their sources of income.
Reducing your superannuation withdrawals by remaining in the workforce, gives your superannuation the opportunity to continue to grow. This is a great option for those able to remain in employment.
Furthermore, staying in the workforce keeps your mind active. It also gets you out and about so that you can remain socially engaged in the workplace. For some, it’s appealing to take on a new direction of employment and meet new people. This allows people to pursue something that they’ve never thought of or always dreamed of doing.
Those who need to or choose to work part-time in retirement should consider how this will impact on superannuation and government benefits.
If you’ve retired and you’re in receipt of a full age pension, you’re able to work in paid employment. But you’re only able to earn a small income each fortnight (rates are subject to change) without it impacting on your entitlements. For further details regarding exact earning amounts, you’ll need to check with Centrelink. For some people, earning more and reducing the amount of pension received could certainly be worth it.
Additionally, working part-time could allow retirees to put extra earnings into their superannuation. If you’ve reached the preservation age (the age you can access your super) and you’re under 75, you’ll still need to meet the work test to be eligible to make contributions and still claim a tax deduction.
Seeking financial advice along with early retirement planning will enable you to make the decisions that are right for you when it comes to balancing retirement and income. For further information regarding your work income and accessing superannuation and government benefits, you can contact Centrelink and/ or the Australian Taxation Office.