Ask Rusty – Retired federal employee has small Social Security benefit

Dear Rusty: When I started getting Social Security at 62, I was told by the SS office I would get a smaller monthly amount because I worked for the Federal Government and received a Civil Service Retirement System (CSRS) pension. I paid into Social Security for about 20 years working outside the government, and I now receive only about $280 a month in Social Security. It just seems like I should be getting more. How can I look into this matter that Social Security calls a “windfall?” Signed: Federal Retiree

Dear Federal Retiree: From what you’ve shared, you didn’t contribute to Social Security while earning your CSRS pension, but you did contribute to SS while working elsewhere, thus earning a Social Security retirement benefit in addition to your CSRS pension. Those who receive a federal pension under the old Civil Service Retirement System (CSRS) are affected by Social Security’s Windfall Elimination Provision (WEP), which reduces any Social Security benefit they become entitled to through other work outside the Federal government, and this is the reason your SS benefit is only $280 per month. For clarity, federal employees who retire under the newer Federal Employee Retirement System (FERS) are not affected by WEP because they contribute to Social Security.

The formula for computing Social Security when WEP applies is rather complicated and depends on the number of years you contributed to Social Security from substantial earnings in the private sector. With 20 or fewer years contributing to SS you incur the maximum WEP penalty for your “eligibility year” (the year you turned 62), but with more than 20 years contributing to Social Security the WEP reduction is mitigated, and with 30 or more years contributing to SS, WEP no longer applies. 

If you were receiving your CSRS pension when you claimed Social Security, your WEP-reduced SS benefit was computed at that time and has continued. But if you had additional years working and contributing to Social Security after you first claimed, it’s possible that you now have more than 20 years contributing, in which case you may be entitled to a smaller WEP reduction and thus a higher Social Security benefit. The only way to find out if you’re now entitled to a higher benefit due to additional years contributing is to call Social Security, either at your local office or at the national number (1.800.772.1213) and ask them to review your current benefit under WEP. If you now have more years contributing to Social Security than you had when you first claimed, you may be entitled to a benefit increase. 

Before calling SS, you may wish to first review your lifetime earnings record on file at Social Security and determine how many years of contributions from substantial SS earnings you actually have. You can get a copy of your lifetime SS earnings record from Social Security, most easily from your personal online “my Social Security” account. If you don’t yet have an online account set up, you can easily do so at www.ssa.gov/myaccount.  Then, you can review your lifetime SS-earnings against the chart at the following link which shows what your earnings must have been each year to count under WEP: www.ssa.gov/pubs/EN-05-10045.pdf.

So, to recap: if you continued to work after starting your WEP-reduced Social Security benefits, you may be entitled to a smaller WEP reduction and thus a higher Social Security benefit now, but you will need to contact Social Security to evaluate your current status (and, if appropriate, increase your Social Security benefit). 

This article is intended for information purposes only and does not represent legal or financial guidance. It presents the opinions and interpretations of the AMAC Foundation’s staff, trained and accredited by the National Social Security Association (NSSA). NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity. To submit a question, visit our website (amacfoundation.org/programs/social-security-advisory) or email us at [email protected].

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