Can I Draw Spousal Benefits While Receiving A Pension From My Employer?

Apr 19 2017 - 6:24am

My employer opted out of social security many years ago for a pension plan that is invested in the stock market. I have worked there for 37 years. I am getting closer to retirement age (within next 10 years) and am not sure how to handle retirement. I lost a significant amount of money years ago and thusly do not have a large amount in my plan <$200,000.00. Can I draw the spouse's portion of social security and draw out quarterly or semi annual amounts from my pension if I roll it over into something. Or is there a certain age where I can have both? Thank you.

Hi,

If your employer is a government employer (e.g. federal, state, local), your Social Security spousal benefits will likely be offset by any pension or withdrawals you receive from your employer's pension plan. This is due to the Government Pension Offset (GPO) provision (https://www.ssa.gov/pubs/EN-05-10007.pdf).

Social Security spousal benefits are offset by 2/3rds of the amount of the non-covered government pension. Non-monthly distributions from a government pension plan are prorated into a monthly rate for purposes of determining the amount of the GPO offset. You would not be able to avoid the GPO offset by rolling over your pension, unless you withdraw only your own contributions to the plan, and you make the withdrawal before becoming eligible for a pension under the plan (https://secure.ssa.gov/apps10/poms.nsf/lnx/0202608400).

But, if your employer is not a government employer, then your pension will likely have no effect on your ability to receive spousal benefits.

The maximization software available on this website is programmed to handle GPO considerations, so you may want to use it in order to explore your Social Security options.

Best, Jerry