Will I Be Able To Collect Both Social Security And Railroad Retirement Benefits?

Jan 11 2017 - 4:00pm

Hi Larry, thanks for your help,

Statement: I'm 58 and have worked a combined 2.5 years for three different rail roads in my life time, otherwise I have worked and paid into social security. I am thinking of taking a job with the UP for approximately 8 years to get a RR pension and retire at 66.

Question: Since I have so many years paying into regular SS for 38.5 years, will I be able to collect SS along with the RR pension which would be a total of 10.5 years...or, will all my SS benefits be transferred to the RR pension for a larger pension?

Hi,

If you meet the requirements for both Social Security (SS) and Railroad Retirement (RR) benefits, you could apply for and receive both. However, you'll essentially receive either your RR Tier 1 benefit or your Social Security benefit, whichever is higher, plus your RR Tier 2 benefit.

The RR Tier 1 benefit is more or less Railroad's substitute for Social Security, and your credits under Social Security are factored into the benefit calculation. Tier 2 RR benefits are similar to a company pension. In most cases, it's only advantageous to apply for Social Security if the benefit rate payable is higher than the RR Tier 1 benefit rate. And, if the SS rate is higher, it may be best to wait until age 70 to apply for the SS benefits. Social Security delayed retirement credits can accrue from full retirement age until age 70, even if a person was drawing RR benefits during that time.

Best, Jerry