The Smart About Money website will be retiring on July 31, 2021. Learn more about this decision.


3: Analyze Your Decisions

The Payoffs and Trade-offs of Working

20% - The number of Americans 65 or older who are still working
~ Bureau of Labor Statistics

How long will you work? Would you consider working after retirement? Consider these benefits and trade-offs of working as long as you can and after you retire:

list of tradeoffs and pay-offs of working longer

Taxing Social Security Benefits

Light bulb

Take a guess: What percentage of your Social Security benefits may be taxable?

  • 25%
  • 55%
  • 85%
  • 100%

Depending on your sources of income, up to 85 percent of your Social Security benefits may be taxable. Taxable income can include military retirement pay, pensions and annuities, Individual Retirement Accounts (IRAs), unemployment compensation, alimony, gambling proceeds or income from a spouse (if you are married and filing jointly). Check out the Tax Guide for the Retiree (PDF) from the IRS for more information.

What Happens with Social Security If I Continue to Work After Retirement?

The Social Security Administration allows you to continue working and take your Social Security benefits. However, there are limits on what you can earn before your benefits are reduced (unless you are at full retirement age). The amount you can earn changes each year, so view the information for yourself at the Social Security website.

Will You Have Enough to Live On?

When you think about how long you will work before and after retirement, a good place to start is looking at your savings and estimated retirement income. Sure, it may be a long shot to estimate these right now, but you have to start somewhere. Additionally, completing this step will prepare you to work with a financial planner.


The AARP Retirement Calculator gives you an overview of your income from Social Security benefits and your savings for each year of your retirement. It shows you where shortfalls can happen and lets you adjust options like your retirement age to see how this impacts your retirement income.

Manipulate some of the options in the calculator to better appreciate the effects of choosing to work longer or work after retirement.

Course Home