Would It Be Smarter Financially To Not Work At All?

Aug 27 2019 - 2:56pm

Hi Larry, my question is along the lines of an earlier one with a slight twist. I retired early (age 48) from a well-paying job (around 100K/year for the last five years of work), so didn't have 35 total years in the workforce. I'm now 52 and took a part-time, minimum wage job as a AVID Tutor not because I need the money, but because I want to give back for my education. Will this low-paying job reduce my Social Security Benefit when I take the retirement benefit (planned at age 67)? Would it be smarter financially to not work at all? Thanks!


It you have less than 35 years of earnings on which you paid Social Security taxes, then any additional earnings would be better than no earnings. Your Social Security retirement benefit rate will be based on an average of your highest 35 years of wage-indexed earnings (https://www.ssa.gov/pubs/EN-05-10070.pdf). If you have fewer than 35 years of Social Security covered earnings then zero earnings years will be included in the average, which would obviously drag down your per year average and your resulting benefit rate. Replacing those zero years with even a small amount of earnings will help, not hurt, your benefit rate.

You may want to consider using our software (https://maximizemysocialsecurity.com/purchase) to do your Social Security planning. The software allows you to enter projected future year earnings so that you can gauge the effect that those earnings will have on your benefit rate.

Best, Jerry