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What to know if you’re not interested


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The combination of record-high prices and record job numbers has encouraged more retirees to return to work. The trend, known as “not taking note”, recover this spring to pre-pandemic levels.

About two-thirds, or 68%, of retirees would consider going back to work, according to recent data CNBC All-American Workforce Survey. The pandemic has prompted many to accelerate their retirement, with 62% of retirees saying they left the workforce earlier than planned and 67% saying they left at least two years early.

In addition, 42% of the respondents in a Survey of the National Retirement Institute said it plans to apply for Social Security benefits early and keep working, up from 36% in 2021.

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Job opportunities are there: Although employment fell in June, there are still 1.8 open jobs per existing worker.

But if you’ve already received Social Security retirement benefits, there are a few things you should know before you start earning your paycheck again.

According to Joe Elsasser, founder and president of Covisum, a provider of Social Security claim software, Social Security beneficiaries can make more money in the short term and ultimately may increase the monthly allowance check amount.

But in the short term, they may be subject to changes in interest worth planning. “That’s the surprise people want to avoid, that’s not knowing the earnings test is going to take place and they’re going to get a penalty,” says Elsasser.

Here are a few things you should know before skipping.

Notify Social Security of your return to work

Elsasser advises: If you plan to return to work, you should notify the Social Security Administration immediately. That way, the agency can start reducing your check now.

Otherwise, you could be in for an unexpected surprise early in the year after the IRS reports your earnings to the Social Security Administration.

If that happens, you may receive a surprise letter from the Social Security Administration notifying you that it will stop your benefits immediately until any income penalties from the previous year are paid off. .

That can disrupt your cash flow if you don’t expect it.

Income penalties may temporarily reduce benefits

In the calendar year you reach retirement age, you actually have a lot more flexibility to work and earn, and less penalties.

Joe Elsasser

founder and president of Covisum

If you go from age 62 to full retirement age and return to work after claiming benefits, you will be subject to an income penalty, which has two levels.

Below the first tier, you can earn up to $19,560 penalty free in 2022. For every $2 you earn over that limit, $1 is deducted from your Social Security benefits. .

The second rate applies to the year you reach full retirement age. For that year, in the months before your full retirement birthday, $51,960 income is waived as of 2022.

“In the calendar year you reach retirement age, you actually have a lot more flexibility to work and earn, and less penalties,” says Elsasser.

Although benefits are reduced due to income penalties, people who return to work can still earn more in the short term, as well as later when their benefits are increased.

Check your benefits may be greater later

If you are subject to an income penalty, your benefits will be recalculated later and that means a larger monthly check.

Take someone with a $2,000 Social Security check, who went back to work and made $40,000. According to Elsasser, based on the income penalty, they may not receive a Social Security check for the first five months of the year, but for the remaining months, they will receive a $2,000 benefit.

When that worker reaches full retirement age, the Social Security Administration will count the months they do not receive a benefit check due to an income penalty. It will then adjust the worker’s benefits as if they had subsequently claimed to account for that time.

In the end, their benefits are increased as if they had delayed benefits, Elsasser said.

“That’s the important thing to remember: It’s not a tax,” Elsasser said of the income penalty; “benefits are not lost; your benefits are recalculated when you reach full retirement age.”



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