1.5 million retirees returning to work amid inflation, sinking stock market
Houston - Skyrocketing inflation, the tanking stock market, and a robust job market are leading many retirees to rejoin the workforce. The U.S. Labor Department says 1.5 million have gone back to work in what's being called the "unretirement" trend.
Inflation was still up 8.6% in May, making it difficult for many retirees to cover their expenses, especially those on fixed incomes. Many are taking advantage of the increased pay and benefits employers are offering as hiring incentives.
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"Y'all got me talking about my sweetie. He had over 500 people attend his funeral," said Karen Cooper, a retiree who returned to work, showing us pictures of her husband. Cooper works at SER Jobs for Progress National, where she also helps other seniors return to work.
Retirees can face life changes and challenges, especially with spiking inflation and a spiraling stock market.
"I know what it costs for me to fill up my tank, $80. This job has supplemented my income," said Cooper. "My husband just passed. It has helped me a lot that way."
"I was lucky enough to move in with my daughter. But listening to a lot of the seniors I help, it is very hard on them. Because it’s just them, and they have just their social security," said Delia Petrocco, who also works at SER Jobs.
"I hear that all the time. My lights are getting cut off or eviction. I’ve had several seniors recently get evicted, because of the support they're not getting," said Larry Mercado, the Texas State SCSEP Coordinator with SER Jobs for Progress National.
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More retirees are turning to programs, such as SER Jobs for Progress National, which offers low-income people over 55, who qualify, paid job training and experience.
"Computer skills, data entry, filing in the office area. Customer service, communication, providing directions at the local hospitals," lists Mercado.
SER Jobs is also seeing an increase in lower-income people interested it its SER Negocias program, which coaches applicants on how to start their own businesses or non-profit organizations.
"How to do a business plan, how to provide financing for your business, how to file LLC with the state of Texas," explains Alfred Gomez with SER Negocias.
But it's not just low-income retirees who are returning to work. Retired professionals are as well, and seeking financial advice.
"We're seeing some folks move out of maybe an executive-type role, or an administrative-type roll, to being a travel agent," said financial planner Ryan Wheless with Allied Wealth Management.
Unretirement is giving retirees a sense of purpose, and a sense of financial stability.
"I could see the change after three months, and they call and say how wonderful their life got because of this program," said Cooper.
Here are links to resources to help retirees find jobs:
SER Jobs for Progress National, LLC
For retirees, while returning to work can boost your income, it can also impact Social Security, taxes, and Medicare.
Wheless explains that Social Security benefits increase for every year you wait to claim beyond your full retirement age. And he says your employer-paid health insurance can cover you before you turn 65 and are eligible for Medicare.
But he cautions, "Medicare premiums are a function of how much income you make. So if you go out and start bumping yourself up into the higher income tax brackets, you can wind up paying more in Medicare premiums," he said.
As for Social Security, Wheless says those who already receive benefits and earn more than $19,560, will have a $1 decrease in benefits for every $2 earned.
He says in the year you reach full retirement age, the earning threshold is $51,960, with a penalty of $1 for every $3 earned over the limit.
Returning to work can also impact income taxes.
Wheless says those over age 72 must take a required minimum distribution for IRA accounts, or face a tax of up to 50%. He says you may be able to delay taking RMD's if you start working again and have an employer-sponsored retirement account.
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He adds the SECURE Act of 2019 allows retirees over 50 to contribute up to $7,000 to traditional IRAs while earning wages. Workers can also take advantage of a 401(k) company match.
Keep in mind if you’re receiving Social Security and taking RMDs, earning a wage may also bump you into a higher tax bracket.