ghostrider20

What's a pension? Never heard of that!

vettebuyer6369

My law enforcement pension meant I stopped making SS payments when I went into the academy...

So I have no SS strategy to speak of.

wmf62

it's that $142.51 a month that I get for the rest of my life....
Bill

tuxnharley

You are fortunate that your agency chose to get out of SS when federal law still allowed that option for state and local government agencies who could show they had an equal or better retirement pension program.

The reason is that SS rules contain a little known "Government pension offset" (ie - penalty) that requires a calculation of 2/3 of a state or local government pension being deducted from what your SS payment would have been.

So if one would have been eligible for the max current SS payment of $2639, a government pension of $3938/mo or $47,265/yr would result in NO SS payment, even after having paid in the maximum for 35 years.

Just another way for the Feds to "redistribute" money.....................

Yeah - no SS strategy required in such cases.

Frankie the Fink

Same for Fed gov't retirees under the OLD pension system. I only made out because I worked so many years outside the gov't as well and paid into SS...

MikeM

So, do government workers, railroaders and others that didn't pay in to SS have access to Medicare? Do they have to have private insurance or obamacare?

Just curious.

tuxnharley

Some do, some don't. Depends on how the individual agency program was set up. Some were in Medicare but not SS.

I know folks who have neither SS nor Medicare. The lucky ones have lifetime medical as a retirement benefit in return for their agency not being in the programs. Remember that the agencies saved the current 8% of payroll also.

Frankie the Fink

As far as Feds Mike, they do pay into medicare but not SS...under the OLD system.

I'll be on Medicare next month....I still pay for Part B though..

ghostrider20

Wait, how many years / Quarters do you have to pay in to get SS min benifits? Is it 40 qtrs?

Is SS based off the highest salary off certain years worked? Amount paid in ?

fyreline

I retired two years ago at age 59 after 40 years in the New York Police & Fire Retirement System. There are several "Tiers" of that system - I was Tier 1 (actually the last one in my city). Retiring as Deputy Chief of Operations, I have very good pension and medical benefits. My wife worked 41 years at one of the four large local hospitals, retiring the same year I did as their Director of Educational Services. She also receives a pension. Being 3 years older then me, she started receiving Social Security at age 62 three years ago. I will start receiving it this year. Our financial advisor has set up a very conservative but so far very effective plan for an investment portfolio to see us through. The moral of the story is that everyone's needs and circumstances are different, and as others have said, you need to run the numbers with a professional to see what will work best for you. There is no "one size fits all" retirement strategy. Take a hard look at yourself, your lifestyle, your health history, and your assets - and formulate a realistic plan. It's pretty late in the game to start now - the wife and I started retirement planning and investments over 40 years ago - but better late than never. Good luck, and get started!

decarmine

I've always said the harder I worked, the luckier I got...

tuxnharley

Yup, 40 quarters for the minimum.

Final amount is based on how many quarters - 35 years max - and whether one paid in up to the max each year. That used to be $80k/yr salary, but I'm not sure what it is now.

ghostrider20

So for you govt guys that did not pay into SS, is the scam to get a private sector job for 5 years then pull SS benifits as well?

ghostrider20

So in the govt world, can you start getting your pension benifits after your 20 years of service?

tuxnharley

How does your agency/you avoid the "Government pension offset" from SS? Are you sure it wouldn't affect you?

tuxnharley

There is no one answer to that question. It's usually a combination of both a minimum years of service and age.

In the military for example IIRC its 20 years at age 50. So even if you start at age 20 and leave at age 45 with 25 years of service you can't draw until age 50.

Local government varies all over the board. Many belong to state systems. One local agency here abouts has its own system, requiring a minimum of 5 years of service and retirement eligibility beginning at age 55 or 30 years of service, whichever comes sooner, at a fixed % per year of service.

Frankie the Fink

For the Feds; unless you take an 'early out'...the full retirement age is 55 with 30 years of service UNLESS you are law enforcement (FBI, DEA, etc) or FAA....they can retire at 50 but IIRC they pay 1% more into their retirement fund each year....

That will get you 56% of your pay based on the highest 3 years' salary while employed. The 'new' system is basically a glorified 401K plan -- the TSP; Thrift Savings Plan. I will have to say the outfit that runs that is one of the most competent bunch of Feds around. If you invested in the right choice of funds - the returns are very significant.

You don't get a 'free pass' on SS either....still need 40 quarters and yes, you get docked very severely if you draw the old gov't pension. However, the more years you work OUTSIDE the gov't the less the 'hit'. (Which is what I did)...

fyreline

I should have clarified - I have, in fact, paid into Social Security all along. We had the option early on not to do so, but few actually selected that option. There is no offset for me or my wife.

scopeli

in the steel industry all it takes for a union employee to get a good pension is to work a lot of overtime in your last 10 years. pensions are calculated by your best 60 consecutive months of your last 10 years. the result can be a pension of over four times the base pension. no need for a investment planner if your willing to work the extra hours. on top of that you still get social security benefits.

vettebuyer6369

Depends where you worked. No scam necessary in our agency, as after X years we got 80%, so the offset, even though some of us had enough previous years of SS payments, would likely keep any additional SS checks in the future at a minimum.

No SS payments were nice, but sworn officers were paying close to 12% in pension payments while nonsworn people paid 4%. After retirement that 12 % payment going away is a nice bonus.