Ask the Expert: Boosting your benefits

Let's say you receive Social Security while working at a part-time job where they deduct Social Security tax from your pay. Will the amount they deduct help to increase your benefits over time?  

Maybe. The answer is probably yes if you spent less than 35 years in the workforce. It's probably no if you worked for 35 years or more, and you always earned the maximum amount subject to Social Security tax.

Your benefit is determined by a mathematical formula that crunches 35 years of your work history, always using your highest-paid years -- and as long as you work, the Social Security Administration automatically recomputes your benefit every year, says Jane Zanca, an agency spokeswoman.

Let's say you spent only 20 years in the workforce because you took time off to raise children. In that case, the 35-year formula determined your benefit by using 20 years of actual earnings and 15 years of zero earnings.

Your 2011 part-time earnings will boost your benefit because in the re-computation, 2011 will automatically replace a year of zero earnings. Any increase you're entitled to will be paid to you in December 2012, and retroactive to January 2012.

OK, but what if you spent 35 years or longer in the workforce? In that case, your 2011 part-time job can only boost your benefit if it pays more than you earned in the lowest-paid of the 35 years used in the calculation that determined your current Social Security benefit. That isn't likely -- but depending on your work history, it isn't impossible. For example, if you're a part-time human resources consultant, you probably make more today than you did as a lifeguard 40 years ago.

The bottom line. Every worker's Social Security benefit is recalculated annually, so a part-time retirement job may boost your benefit.

Websites with more information 1.usa.gov/lLgTzc and 1.usa.gov/lkQvtj