Working During Retirement: Finding Purpose As You Earn Extra Income

Why many people choose to work in retirement

The benefits of working after retirement

Staying engaged and connected

A job can provide structure, social interaction and a sense of accomplishment. If you’ve worked most of your life, you might find the change from a packed schedule to unorganized free time difficult. Many retirees find they feel more energized and connected when bringing their skills and experience back to the workplace.

Supplementing your retirement income

Earning a little outside income can help cover everyday expenses, reduce withdrawals from retirement accounts or fund long-term goals. When you’re trying to balance your post-retirement income with Social Security benefits and required minimum distributions (RMDs) from retirement accounts, even a modest salary can make a powerful difference in the long run.

Exploring “encore careers”

Retirement can also be a great time to finally take on work that truly fits your interests or passions. An encore career, or a second career typically pursued later in life, lets you lend your skills to community organizations, education, customer support, hospitality or nonprofit work.

Learning something new

Part-time work or short-term training programs can help you develop new skills, discover hobbies or explore fields you didn’t have time for earlier in life. In addition to the extra income, you may open new pathways that directly relate to your interests and purpose.

Popular ways to work during retirement

According to AARP’s Work & Jobs resources, many retirees are exploring flexible roles that offer low stress, purpose and additional income.

Part-time or seasonal jobs

Flexible or seasonal work is a popular option for retirees who want predictable schedules without the full-time commitment. You’ll still get structure and income, but you’ll also have the free time for travel, family or other favorite leisure-time activities.

Remote or hybrid work

Remote roles offer flexibility and convenience in jobs like customer service, bookkeeping, tutoring, writing or administrative support. These can be especially good options for retirees who specialized in more niche fields like accounting, and provide an opportunity to continue using the skillset developed over the course of your career.

Consulting or freelance work

Much like remote or hybrid work, consulting can be another way to stay active while controlling the hours you work. You’re able to decide whether to take on a few projects each year or create a steady flow of assignments.

Small business or hobby-based income

Retirement can also be a time to explore your entrepreneurial side. A small business devoted to crafting, gardening, coaching, home repairs or online sales can be both personally rewarding and financially beneficial.

Community or nonprofit roles

Many retirees find fulfillment working with schools, libraries, museums or nonprofit programs. These roles provide purpose and connection as you work to better your community.

How working may affect your financial plan and social security

Working during retirement can be positive for your finances, but it may also affect taxes, retirement benefits and any future income. Understanding a few key rules can help you plan confidently and avoid overpaying taxes.

You’re allowed to work and receive Social Security retirement or survivor’s benefits at the same time. If you’re younger than your full retirement age (FRA), your benefits may be temporarily reduced if your earnings exceed the annual limit.

The earnings limits are as follows:

• If you reach full retirement age in 2026, your earnings limit is $65,160 for the months before you reach FRA. Benefits are reduced by $1 for every $3 earned above the limit until the month you reach full retirement age.
• Starting the month you reach full retirement age, your benefits won’t be reduced regardless of how much you earn.

Social Security also reviews earnings each year. If your new earnings are among your highest-earning years, your benefit may be recalculated and increased. These earnings count toward that limit:

• Wages
• Self-employment income
• Bonuses, commissions and vacation pay

Earnings not counted include the following:

• Pensions and annuities
• IRAs and 401(k) withdrawals
• Investment income
• Veterans benefits or other government retirement benefits

Extra income may affect your tax bracket, how your Social Security benefits are taxed and the best time to withdraw funds from your retirement accounts.

If you’re not yet eligible for Medicare, part-time or full-time work may provide access to employer health coverage. If you have Medicare, additional income may influence those premiums, so it’s helpful to understand how your earnings fit into your broader health plan.

Tips and resources for finding the right retirement job

• Identify your goals: Extra income, flexibility, social connection, purpose or an opportunity to try something new.
• Choose roles that fit your lifestyle: Many retirees prefer 10–20 hours per week, seasonal work or project-based assignments.
• Your background can open doors to consulting, mentoring or part-time leadership roles depending on your career experience.
• Retirement can be the perfect time to try something different: Many people pursue roles in education, creative fields or community services that weren’t available or financially feasible during their careers.
• Use trusted resources: Visit local community centers, state job boards, nonprofit organizations, online job platforms and AARP’s job resources and training programs.

Even a small income can help your retirement savings last longer. If you’re still curious whether working during retirement may make sense for you, a financial professional can help you better understand how part-time work may impact your Social Security benefits and fit into your overall retirement plan.