Telephone: +1 800 866 0695


Here’s the scenario: You retired last fall at age 63 with great expectations of all the new things you would be able to do with your free time. Except that learning jazz piano has proven more challenging than you thought, your spouse can’t stand the mess you make in the kitchen trying to re-create the recipes you learned in that pastry-making class and you’re so hooked on flash sales you’re on a first-name basis with the UPS guy. 




Admit it: You miss working. Leaving the labor market is hard. 




You miss the intellectual challenge, the camaraderie you had with your co-workers and the feeling of being valued. If you were in management, you might even miss bossing people around- something you don’t dare try to do to your spouse. 




Making the transition from full-time employment to retirement can be traumatic. It entails a major emotional and psychological adjustment, not to mention a financial one. In short, it takes planning and preparation.




So, with your spouse’s blessing (insistence?), when your former boss calls and asks if you’d like to come back on a part-time basis, you jump at the chance.




There’s only one hitch: You already started receiving Social Security. Should you stop it? (Technically, this is called “withdrawing” your application for benefits and is an option only if you have received benefits for less than 12 months.) Telling Social Security to stop sending monthly checks would require paying back (without interest) all of the benefits you’ve already received. Although this would enable you to re-file at a later date and get a larger check (because you’d be older), you don’t have that kind of money hanging around. Plus, you’re not sure how long the part-time gig with your former employer is going to last.





So you decide to continue receiving Social Security and cheerfully head back to work on special projects and putting in about 15 hours a week.




Everything is honky-dory until you get a letter from the folks at Social Security (most likely after you file your 2014 tax return) telling you that you exceeded this year’s “earnings limit” and, as a result, they overpaid you. The administration is now withholding all benefits in 2015 until this amount is recovered, and it wants to know if you plan to work next year as well because depending upon how much you earn, it may have to withhold some of your benefits again.




What the heck?! Didn’t you earn that benefit? Isn’t that why you had FICA tax withheld from your paychecks for the 42 years you worked? What’s the point in working to earn extra money if you’re going to lose your Social Security benefit? You might as well sit in your recliner and watch Three Stooges reruns.




Hold on. 




Yes, there is something called an “earnings limit” that may require that Social Security withhold some- or all- of your benefits. But you don’t “lose” the money. And, working while you are getting Social Security could mean a bigger check down the road.




Here’s how it works:




It’s the Law (Blame Congress, not Social Security.)




Social Security cannot pay you your full benefit if you are under “full retirement age” (FRA) and your income from a job exceeds a certain amount. Interest on bank accounts or bonds, dividends from stocks and income from retirement accounts, pensions, or military retirement benefits is not counted- just earned income.




There are two different earnings limits,




If you are not reaching FRA this year the 2014 earnings limit is $15,480. (This is adjusted for inflation annually.) For every $2 you earn above this amount, Social Security is required to withhold $1 in benefits. Thus, if your gross earnings from a job are $20,000, your annual benefit will be reduced by $2,260. ($20,000-$15,480= $4,520/2= $2,260.)




If 2014 happens to be the year you are turning 66, there is a different- and substantially higher- earnings limit. Only the months before the one in which you turn 66 are considered. During this period, you can earn up to $41,400 and have no reduction in your Social Security benefit. For every $3 in earned income above this amount, your benefits will be reduced by $1. 




The month you reach FRA the earnings limit test disappears. At this point, no matter how much you earn from a job, it will have no impact on the size of your monthly check. (Aren’t you relieved to know that 83-year old Warren Buffett is receiving his full Social Security benefit?)




The “Special” Rule




Even if your earnings for the year exceed the annual limit, you might still be able avoid having your monthly Social Security benefit reduced. This depends upon the amount you earned in a month and whether you were what Social Security calls “substantially” self-employed. The dollar amounts differ depending upon whether you are under or turning full retirement age this year.




You Don’t “Lose” the Money




Income that Social Security withholds because your earnings exceed the limit gets credited to your account. At FRA, your benefit will be adjusted higher to reflect this.




You Can’t Hurt Yourself by Continuing to Work




The size of your Social Security benefit is based on your 35 highest years of inflation-adjusted earnings. Even if you are already receiving Social Security, for each additional year you work, your record will be evaluated to see if a lower year of earnings should be dropped in favor of your most recent earnings. This will also increase your benefit. 




Social Security is a unique and valuable retirement benefit. You essentially get one shot at choosing when and how to begin receiving it. I strongly recommend you think this through carefully and consider getting advice. If you are married, it is essential that you coordinate your benefits so that you can maximize the joint income you receive as a couple. 




Your Social Security decision will literally affect the amount of income you receive for the rest of your life.




By Gail Buckner






List of Articles
Subject Date Views

Albert Einstein and Fixed Indexed Annuities: Finding Peace of Mind During Retirement

As retirees work toward a peaceful retirement, they tend to remain on the same path that led to where they are today, waiting out any tumultuous periods in the market. Instead of using the volatile market as a means to change course, or at ...

  • Jan 20, 2016
  • Views 60

Medicare Premiums & Deductibles 2016 file

  • Dec 05, 2015
  • Views 28

$4,363 tax bills jolt L.A. workers

This tax season, many Los Angeles residents with home-based businesses received letters from the city that hit them right where they live and had frightening implications. The key line in the letters from the Office of Finance reads: "The f...

  • Oct 27, 2015
  • Views 226

How Work Can (Temporarily) Reduce Your Social Security Check

Here’s the scenario: You retired last fall at age 63 with great expectations of all the new things you would be able to do with your free time. Except that learning jazz piano has proven more challenging than you thought, your spouse ...

  • Sep 25, 2015
  • Views 6

Same-sex couples able to collect spousal Social Security benefits

Kathy Phelan (right) and her late wife, Kaye, legally married in 2013. But Phelan was denied survivor benefits from Social Security after Kaye succumbed to cancer last year. Same-sex couples across the U.S. will now be able to collect spous...

  • Sep 01, 2015
  • Views 4

An Exclusive Team for Physicians! file

  • Jun 05, 2015
  • Views 11

Free Fall at 100 file

Free Fall at 100 : Age Doesn't Slow S. L. Potter, Who Bungee Jumps From 210 Feet October 14, 1993|MICHAEL GRANBERRY | LA TIMES STAFF WRITER ALPINE, Calif. — Defying age, common sense and the fears of his children, 100-year-old S. ...

  • May 28, 2015
  • Views 311

Questions to Consider When Selecting a Business Entity

When setting up a new business, it is important to put some thought into the legal structure of your company. Many business owners simply start the business to see if the business idea is valid before they ever even think about the legal st...

  • Apr 30, 2015
  • Views 6

Millennials lean more on parents (but please don't call it mooching)

Corrections and clarifications: A previous version of a graphic in this story incorrectly identified the percentage of Millennials currently receiving help from their parents and the percentage of parents currently giving help. Millennials ...

  • Apr 22, 2015
  • Views 243

Can I have both Medicare and VA benefits?

Q: I am going to be 65 next year, and I have a nice coverage from VA benefits. Can I have both Medicare and VA benefits, and if so, what additional coverages am I suppposed to buy? A: You can have both Medicare and Veterans Affairs (VA) ben...

  • Apr 17, 2015
  • Views 3

16 percent of retired NFL players go bankrupt: Study

Success in the National Football League doesn't protect players from bankruptcy. Nearly 16 percent of NFL players drafted between 1996 and 2003 declared bankruptcy within 12 years of retirement, according to a new working paper released...

  • Apr 16, 2015
  • Views 22

The Power of MFTA: Risk Free, Tax Free Retirement

Tax-Advantaged Strategies Money that grows under tax-favorable circumstances is money that not only grows, but remains your money. Knowing how to accumulate your money tax-free, rather than just tax-deferred, means that your nest egg remain...

  • Feb 23, 2015
  • Views 39

The Shocking Reality about Federal Employees Disability Benefits

The reality is, most Federal Employees don’t have any idea what their long term disability plan would pay if they got sick or hurt. Don’t get me wrong. I think it is great that the Federal Government has a plan in place at no co...

  • Nov 20, 2014
  • Views 22

Top 8 Year-End Tax Tips

Act before Dec. 31 to increase your tax breaks Whether you are having a good year, rebounding from recent losses, or still struggling to get off the ground, you may be able to save a bundle on your taxes if you make the right moves before t...

  • Nov 18, 2014
  • Views 43

Required Minimum Distributions (RMDs)

Retirement accounts like IRAs and 401(k)s are attractive because the government allows earnings in these accounts to defer taxes—but only for so long. Once you turn 70½, you're required to withdraw a minimum amount every ye...

  • Aug 26, 2014
  • Views 23

California gives further reprieve for Obamacare...

"I know a lot of people wait until the last minute," Caceres said. "And I was one of them." In contrast to those in many other states, California's exchange website had largely avoided major technical problems. But even it was hard hit ...

  • Apr 01, 2014
  • Views 75

Year-End Tax Tips for 2013

Year 2013 Tax Returb Key Points These tax tips for 2013 address key areas of your financial life: portfolio planning, retirement, education planning and charitable giving. It never hurts to consult with a tax professional about your unique ...

  • Nov 21, 2013
  • Views 13

Social Security Trust Fund to Run Dry in 2033?

WASHINGTON (MarketWatch) — Medicare’s finances got an upgrade on Friday but the long-term prognosis for Social Security stayed the same, in the latest snapshots of the politically sensitive entitlement programs that are certain ...

  • Sep 12, 2013
  • Views 4

When Should We Take Social Security? file

Social Security Benefits Maximizing Strategies The Social Security program allows you to start receiving benefits as soon as you reach age 62. The question is, “should you?” Monthly payments differ substantially depending on whe...

  • Jun 20, 2013
  • Views 3
Social Security Reports
Social Security is enormously complex. Making correct decisions will maximize your lifetime benefits. A Powerful Strategy for Starting Social Security! Get Your Complimentary Social Security Snapshot Report Today!
More Info
What We Do
At Good Life Advisors, the measure of our success is your success. When you are happy, we are happy too. We take the time to listen and get to know our clients.
More Info

Sign In

로그인폼

Keep me signed in.