In the same way that it is important to get your finances squared-away before retiring, it is also extremely important to understand how returning to work will affect your finances. In particular, returning to work will likely affect Social Security benefits, taxes, health-care coverage and pension. If you do not know how returning to work will affect these important financial considerations, speak with someone who is familiar with your financial situation and who will be able to advise you regarding the impact of returning to work., Depending on your age and your income, your Social Security benefits will likely be reduced if you return to work. That said, you can still collect benefits and work, especially if you’re only working part time.Most importantly, if you go back to work prior to full retirement age and earn a certain level of allowable income, your benefits will be reduced by $1 for every $2 you make above that level.
Your full retirement age varies based on the year you were born, but is likely 66-70. As of 2016, the allowable income you can earn while receiving full Social Security benefits is $1,310 per month, or $15,720 per year.
 For example, if you go back to work in 2016 at age 64 while receiving benefits, and make $20,720 dollars over the course of the year (without reaching your full retirement age during that year), you made $5,000 more than the allowable amount while receiving benefits. This is the amount that will be ultimately used to determine the reduction in your benefits. The more you make, the more your monthly Social Security benefits will be reduced.You’ll need to report expected monthly income while receiving benefits. It is this number that will be used to determine the monthly reduction in your Social Security payment. If your income turns out to be different than reported, you will either owe additional taxes or be given a tax rebate after filing taxes.
 Many people will benefit by postponing the point at which they begin to receive Social Security benefits. If you have retired, but have not begun receiving any Social Security benefits, consider waiting to do so until you’ve reached full retirement age (likely 66-70, depending on the year you were born). By doing so, you’ll receive delayed retirement benefits that equate to greater financial gain in the long run.If you retire, start receiving benefits, and decide to go back to work within a year, don’t worry. You can stop the benefits dispersal, pay back what you were given, and maintain the ability to receive benefits when you retire for good.
 If you’re receiving money from investments, including distributions from a retirement plan, going back to work may put you in a higher income bracket and increase the taxes you owe. The main thing to consider is whether going back to work may actually cost you. In simplest terms, remember that your Social Security benefits will likely be taxed as federal income.For instance, if you set up a 401(k) or IRA that deferred income tax until it was withdrawn from the account, the financial incentive for doing so was the assumption that you’d be in a lower income bracket after retirement. Essentially, you may wind up paying more (in taxes) to access the money in your retirement savings accounts.
Outline a basic after-tax budget. Make an estimated bottom line assessment of how going back to work will ultimately affect your annual income.
Speak with a financial professional before returning to work.
Assess your Social Security standing.
Do the math.
Postpone your Social Security benefits.
Acknowledge income tax considerations.
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