CON: Social Security Benefits can be impacted!

While you will be able to possibly delay the RMDs, continuing to be part of the workforce can negatively impact your Social Security benefits if you end up signing up for those as well. Not only will you receive less of them if you take them out earlier than intended if you go over a certain income threshold, but you can end up having to pay taxes on these benefits due to the overall sum of your combined income.

The combined income is made up of your AGI (adjusted gross income), any nontaxable interest you may have, and half of the amount of your benefits for that year. If the amount goes over the thresholds put in place by the IRS (which are $25,000 for a single filer and $32,000 for married couples), then you will have to pay taxes on the Social Security benefits.

The only way in which it would still be okay to keep on working and not have issues with your benefits is to either make sure that you make less than the thresholds they have put in place or to delay receiving them until you are 70. While it may translate into bigger checks later, it will still cost you if you wish to keep on working, so put everything in balance and see if it’s worth it.

If you want to better understand how Social Security works, we recommend that you consider reading this book!