By Reg Jones
Q. I retired under CSRS and chose a survivor benefit for my wife.
My wife worked in private industry and contributed to Social Security and started collecting a Social Security pension.
My last letter from OPM said my wife would receive a survivor benefit of $670 per month.
How would the offset provision affect her monthly income in the case of my demise?
Q. I plan to retire at my minimum retirement age, 56. I should get the FERS special retirement supplement, although I realize it may be reduced or suspended if my earnings exceed the limit. If I do receive the supplement but at age 62 do not apply for Social Security until the full retirement age of 67, do I still get the higher payment, or does the supplement reduce the amount anyway?
Q. I will complete nine years of civil service as of August, as well as 22 years of military service. If I apply for Voluntary Separation Incentive Pay, what, if anything, can I expect to receive?
Q. I am a CSRS retiree, and I am not eligible for Social Security. I have provided for a full survivor annuity if I die before my wife.
She is self-employed and will be eligible for a Social Security benefit when she retires. Will her Social Security benefit be reduced at that time due to her survivor annuity? Will her survivor annuity be reduced because of her Social Security benefit?
Q. The following statement was made in an answer to a question ask about post-1956 deposit: “You can’t get a refund of the deposit you made for your active-duty service. What’s done is done. If you retire at age 62 and aren’t eligible for a Social Security benefit at that time, you’ll never have to worry about losing those years and having your annuity recomputed.”
I will retire at age 60 and have paid in a post-1956 deposit. I am in CSRS and will have 41 years and eight months with the post-56 deposit (eight years, six months of military service). I have worked for 40 quarters and am eligible for Social Security (military service and work prior to the military). However, due to the windfall elimination provision, I do not plan to ask for Social Security benefits until I am 65 or older. Will my annuity be recomputed after I reach 62 even though I have no intention of requesting my Social Security benefit until 65 or 70? Can I expect some kind of reduction in my annuity? I understand my Social Security benefit will be reduced by two-thirds once I apply for it.
A. Because you made a deposit for your active-duty service, you’ll not only get credit for that time in your annuity computation but your CSRS annuity won’t be affected no matter when you apply for a Social Security benefit. However, as you noted, your Social Security benefit will be reduced because of the windfall elimination provision. That’s because you will be receiving an annuity from a retirement system where you didn’t pay Social Security taxes and have fewer than 30 years of substantial earnings under Social Security.
Q. I am a 48-year-old FERS employee with 25 years of civil service. Our organization has offered a Voluntary Early Retirement Authority. If my organization approves my VERA, when would I be eligible to receive an annuity? Immediately or at age 56? What are the near- and long-term pros and cons of accepting VERA?
A. Because you have at least 25 years of service, you would be eligible for an immediate annuity. When you reached your minimum retirement age, you would be entitled to the special retirement supplement. However, if you had earnings from wages or self-employment at the time that exceeded the annual Social Security earnings limit, your SRS would be reduced or suspended. As for any other near- and long-term pros and cons, you’ll have to figure those out for yourself.
Q. I am a letter carrier, age 52, started in 1985 and have 28 years of creditable service.
If I understand what I’ve gleaned from the posts here and the Postal Service were to offer me a Voluntary Early Retirement Authority this year,
1. Would I begin my annuity immediately?
2. Would I have no reductions in calculations of my annuity? (average high-3 x 1 percent x 28)
3. Would I receive credit for half of my sick leave and all of my annual leave? (How are these applied?)
4. Would I receive the special retirement supplement beginning at age 56 (my minimum retirement age), and receive it until I reach age 62?
5. Would I be able to continue carrying my current health and life insurance at non-USPS rates? (I couldn’t find how long these could be carried. Until death?)
6. Could I begin receiving Social Security as early as age 62?
7. Any withdrawal from my Thrift Savings Plan prior to age 59½ would be penalized 10 percent as per Internal Revenue Service regulations? (Can I continue to contribute to TSP after retirement?)
8. As a FERS annuitant, is there no limit to what I can earn after separation from the Postal Service as it pertains to my annuity payment?
9. At age 56 (my MRA), the special retirement supplement from Social Security would begin and would be subject to yearly income limits. Would supplement payments be reduced by approximately $1 for every $2 I earned above that year’s Social Security income limit?
10. At age 65, I’d be eligible for Medicare parts A and B? (Would this affect my health insurance coverage through Federal Employees Health Benefits?)
11. Would there be cost-of-living increases at any point for my annuity?
12. Is there a date during the year that maximizes the benefits of retirement?
Did I get this right, and are there any other things I should know before considering a VERA if it is offered?
Tags: 401(k), annual leave, annuity, cost-of-living adjustment, creditable service, early withdrawal penalty, enrollment, FEHB, high-3, income, IRA, IRS, LIFE INSURANCE, lump sum, Medicare Part A, Medicare Part B, minimum retirement age, Postal Service, sick leave, SOCIAL SECURITY, special retirement supplement, TSP, VERA
March 21st, 2013 | Uncategorized
Q. I took the Voluntary Early Retirement Authority on July 31. I am receiving the special retirement supplement. I have since applied for Social Security disability. If I am approved for SSDI, will I lose the supplement even though I did not file for Postal Service disability? And will I have to pay back the supplement for the months I receive back pay from Social Security? And will I need to notify the Office of Personnel Management that I am receiving Social Security disability?
March 21st, 2013 | Uncategorized
Q. I’m looking to retire sometime this year. I turn 66 on April 2, have 13 years at the Veterans Affairs Department, from which I withdrew funds. I worked in the private sector until 1995, when I started working for the Postal Service. I am under CSRS Offset, and I have essentially bought back my four years in the military. So the total years at the Postal Service would be 18 years + 4 years military = 22 years. Can you explain to me how the offset will apply to me? Will I be able to receive Social Security?
March 20th, 2013 | Uncategorized
Q. I worked for the Postal Service from March 1986 until August 1999.
Will I be eligible for Social Security or a pension for that time? Will I need to contact human resources in the state in which I resigned?
A. If you left your FERS contributions in the retirement fund when you left, you’d be eligible for an annuity at age 62. If you took a refund, you wouldn’t. Because you’ve earned at least 40 credits under Social Security, you’ll be eligible for a Social Security benefit at age 62.
March 20th, 2013 | Uncategorized
Q. I expect to retire with income from a state employee retirement, CSRS offset and Social Security paid while working other than the CSRS offset Social Security.
To what extent will the windfall elimination provision apply? Since there are two Social Security eligibilities, does the WEP apply to both? Will the CSRS offset Social Security portion be reduced by the WEP as well as the Social Security earned when working for nongovernment employers?
A. At age 62, your annuity will be reduced automatically by the amount of Social Security benefit you earned while a CSRS offset employee. If you have fewer than 30 years of substantial earnings under Social Security, you’ll also be subject to the windfall elimination provision. If you are subject to the WEP, it could affect the amount of Social Security benefit attributable to your CSRS offset service.
March 19th, 2013 | Uncategorized
Q. I work for the USPS. I was born in 1967. Therefore, my minimum retirement age is 56½. Let’s assume I retire on my 57th birthday. By that time, I will have a little more than 27 years of service time. (I started in 1997, when I was 29½.) According to other federal websites, the special retirement supplement is given for: 30 years and at the minimum age; at least 20 years and you receive the supplement when you are age 60; with an early out, as is happening this year, you get the supplement but you have to wait until the minimum age.
If I retire when I am 57, and I have 27-plus years with the Postal Service, do I get the special FERS supplement, and if I do, do I have to wait until I am 60 to get it since I did not do 30 years. Finally, if the answer is yes, how long do I get the supplement? For two years? At age 62, I can apply for Social Security.
A. Because you have already reached your minimum retirement age, if you are offered and accept an offer of early retirement, you’d be entitled to immediately receive the special retirement supplement.
March 19th, 2013 | Uncategorized
Q. I am a CSRS retiree. My husband still works and is under Social Security. When he dies, will I receive anything from his Social Security? I am aware there is something called the government pension offset, but I don’t understand it. Can you explain?
A. Your Social Security spousal or survivor benefit will be reduced by $2 for every $3 you receive in your CSRS annuity. To better understand the government pension offset and the reason it is a matter of law, go to http://ssa.gov/pubs/10007.html.
March 18th, 2013 | Uncategorized
Q. I am under FERS with a CSRS component (10 years CSRS, 15-year break, FERS for the past 20 years). If my spouse receives Social Security benefits based on my work history and I predecease him, and he begins receiving an annuity, will his Social Security payments be reduced or possibly eliminated under the government pension offset? He has enough quarters to qualify on his own record and is receiving payments now. However, under my records, his payments would be higher. I will retire in a year, at age 66, and would like to know before we request that his payments be based on my work history.
A. If he receives an annuity from a retirement system where he didn’t pay Social Security taxes, such as CSRS, any Social Security spousal or survivor benefit would be subject to the government pension offset.
March 15th, 2013 | Uncategorized
Q. I am almost 62 years old and qualify for a CSRS deferred annuity, even though I left federal service 18 years ago. I have not been able to find anywhere (including the Office of Personnel Management website) how to apply for the deferred annuity. Do I initiate the action? If so, how? Do they initiate the action? If so, when? The only form I can find seems to indicate that OPM will initiate the action by sending me a letter and attached form, but they do not even have my current address, and I certainly do not have all the start and end dates for all of my federal positions (which the form requests). So what do I do?
A. Write OPM a letter telling them that you will soon be eligible for a deferred annuity. Be sure to include your full name, birth date, address, Social Security number, the name of the agency for which you worked and the approximate dates when you worked there. Send the letter to this address:
U.S. Office of Personnel Management
Retirement Services and Management Group
P.O. Box 45
Boyers, PA 16017-0045
Attn: Deferred Annuity
Q. I am trying to figure my calculations under FERS disability retirement and Social Security. I am receiving Medicare under Social Security Administration without monetary benefits because of workers’ compensation. Would you please calculate a high-3 of $54,000; and Social Security entitlement of $1,700 monthly on a 60% and a 40%. What would be the separate amounts received from both? Also, do I have to fill out both forms, SF 3112 and a SF 3107 for immediate retirement? I am requesting approval of disability retirement.
A. I can’t do your homework for you. What I can do is give you the formulas you’ll need to get the answers you want. For the first 12 months, you’d receive 60 percent of your high-3 minus 100 percent of any Social Security benefit disability benefit. For all remaining years and until age 62, you’d receive 40 percent of your high-3 minus 60 percent of your Social Security disability benefit.
You’ll need to fill out a Standard Form 3112, Documentation in Support of Disability Retirement, and, at the same time, file for Social Security disability benefits. If you don’t, the Office of Personnel Management won’t review your application for disability retirement.
March 13th, 2013 | Uncategorized
Q. I am not eligible for Social Security retirement. I have 35 quarters of coverage and need 40. I was told if I waited until after age 62 and then earned my 40 quarters and became entitled to Social Security retirement, I would not receive a reduction to my CSRS retirement check. Is this true?
A. As a CSRS retiree, you would not have your annuity reduced if you were eligible for a Social Security benefit. However, because you are receiving an annuity from a retirement system where you didn’t pay Social Security taxes, you’d be subject to the windfall elimination provision. The WEP would reduce your Social Security benefit if you had fewer than 30 years of substantial earnings under Social Security.
March 12th, 2013 | Uncategorized
Q. I’m retired from the military with 21 years (retired in 1992) and eligible for retirement again from the VA in five years under FERS. I will have 25 years with the VA at retirement. Will my FERS annuity or Social Security benefit be affected since I’ve been receiving military retirement pay every month since I retired?
A. Your FERS annuity, which is based solely on your civilian employment, wouldn’t be affected by your retired military pay, and any Social Security benefit you receive would be based on your total years of Social Security-covered employment.
March 12th, 2013 | Uncategorized
Q. I retired from the Social Security Administration in 2002 with 32 years of service under CSRS. I didn’t work long enough in the private sector to qualify for Social Security at age 62. I’m 63 now and would like to work part-time. Am I still subject to possible offset of my pension if I qualify for Social Security, and are there limits to how much I’m allowed to earn?
A. Going to work would not affect your annuity, regardless of how much you earned.
March 11th, 2013 | Uncategorized
Q. I am a 66-year-old federal retiree. My Social Security statement says my benefit at 66 is $1,004 per month, and I have less than 25 years of substantial earnings.
Because of my federal retirement, I know my benefit will be reduced, but by how much? Some Social Security information seems to say it will be reduced by about 50 percent; other information leads me to believe the maximum reduction is $362 per month.
A. Go to http://ssa.gov/estimator and use the benefits calculator provided by the Social Security Administration.