Dos and Don’ts of Working After Retirement

If you decide to trade in your higher-paying position for a part-time one at the same company, it can make a big dent in what you otherwise would have received for your pension, says Freeman.

Unfortunately, he says too many people don't realize the folly of this strategy until they've already moved to a part-time job. It is better to discuss retirement early on with your pension administrator to determine whether your pension will be affected, he says.

• 5. Cover your expenses.

Finally, before you take a job, make sure you’ll make enough, after taxes, to cover expenses.

There are many hidden costs to working that can add up quickly, including commuting, parking, clothing, dry cleaning and meals.

“Just buying a sandwich, with chips and soda can be $12. And that might be an hour of work—pretax,” says Bruno.

To be sure, people nearing retirement have a lot to think about, and the time to do it is before retirement, not after.

“People shouldn’t decide to give up their job until they determine how much they’ll need to live in retirement,” says Littell, the American College professor.

After crunching the numbers, they may be surprised about how little they will actually have to live on.

“Working longer and working part-time are two of the best strategies for improving your retirement picture,” says Littell.