People today are living longer than previous generations. Many
are using part-time work as a way of easing into semi-retirement
before they fully retire.
Here we discuss some of the benefits of part-time work, how you
can use super to help you manage the transition, and the
implications for your age pension if you are still working when you
reach Age pension age.
Benefits of part-time
Working part-time allows you to keep topping up your super.
Retiring from the workforce is a major life change, especially
if you have been working full-time, but it doesn't need to be an
all or nothing scenario. More Australians are choosing to go into
semi-retirement by switching to part-time work before they fully
Some of the benefits include:
- Super conservation - Because you are still
earning an income you won't need to draw as much from your super,
if at all, so it will continue to grow.
- Structure and purpose - Working part-time, for
many people, is a way of keeping their mind active. Work gives our
lives structure and purpose and allows us to identify with and
interact with others.
- Development of other interests - People plan
when they want to retire but many forget to plan what they will do
in retirement. Holding off on permanently retiring gives you a
chance to develop interests and hobbies outside of work.
- Not having to wait until Age pension age - If
you are not yet eligible for the Age pension, working part-time
allows you to semi-retire but still have some income.
See when you can access the Age Pension and your super.
pension age calculator
Women, in particular, often benefit financially from working
longer part-time. Career breaks and lower incomes mean many women
do not have enough super to sustain a comfortable retirement.
If you are aged 55 or over you may be able to take advantage of
a transition to retirement
strategy. This strategy allows you to supplement your pay with a
draw down from your super, if you need to, after you have reached
preservation age. You pay no tax on your
super income from age 60 and your employer will continue to top up
See our case
study on transition to retirement for more information.
Part-time work and the Age
If you are still working when you reach Age pension age your
income may reduce the amount of Age pension you are entitled to.
Singles can earn $164 per fortnight before their Age pension
reduces. It will drop by 50 cents for every $1 you earn over $164.
Couples who are both eligible for the Age pension can earn $292 a
fortnight (combined) without affecting their Age pension. It will
also drop by 50 cents for every dollar of income over this
Part-time work is a great way to supplement your Age pension.
Check your situation with Centrelink.
Working part-time gives you the opportunity to
boost the amount of money you have when you do decide to retire.
There are government incentives in place to encourage you to work,
but keep in mind the income you earn can affect your Age
Last updated: 31 Mar 2017