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If you're over 50 and considering a part-time job, it's important to understand how being employed can impact your Social Security check.
Explore the formula the Social Security Administration uses to determine wage/entitlement ratios. Assume an annual part-time wage of $14,160.00 (the 2010 limit). Deduct $1 from your Social Security check for every $2 you earn over the $14,160 limit before your actual retirement date. Expect the figure to decrease to $1 for every $3 a month before your official date. Once you reach your official retirement date on the Social Security Administration's register, there's no limit to how much you can earn.
Meet with local Social Security benefits administrators before you apply for jobs so you’re fully cognizant of the nuances surrounding the pairing of employment with the receipt of SS benefits. Ask for a list of milestones unique to your age bracket, as these fluctuate every few years based on actuarial studies and fiscal assessments. Call the SSI toll-free number: 1-800-772-1213 between 7 a.m. to 7 p.m., weekdays or 1-800-325-0778 if you are hearing impaired. Have your SS card in hand when you place your call.
Find a job that you’ll enjoy by visiting websites catering to retirees (see link). Enjoy the benefit of listing your entire work history on your resume since age isn’t a deal breaker when you search target sites.
Understand that no matter the number of hours you work or wages you earn, you must continue to pay into the Social Security system while you work your part-time job. Inform your employer that you are receiving Social Security benefits so he knows that your weekly salary has limits that could impact overtime work.
Ask your employer to deduct money from your salary check to cover your Social Security tax and if he refuses, anticipate paying those taxes by putting cash into a savings account so you can write that check in April.
Be aware of the unique relationship that exists between the IRS and retirees who are self-employed or engaged in contract work. Work more than 45 hours a month and you will not be considered “retired” by the Social Security Administration even if you’re 100 years old, as you’re only considered fully retired if you work less than 15 hours a month.
Don’t let the complicated nature of trying to balance your part-time job with your SSI benefits make you crazy as you’ll settle into an understanding of how this works quickly. Meanwhile, enjoy your new career. It won’t be long before you realize just how handy all of the life experience you’ve accumulated can be.
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Based in Chicago, Gail Cohen has been a professional writer for more than 30 years. She has authored and co-authored 14 books and penned hundreds of articles in consumer and trade publications, including the Illinois-based "Daily Herald" newspaper. Her newest book, "The Christmas Quilt," was published in December 2011.