Ask Larry

Am I Receiving The Right Amount?

I'm 68, very healthy, with a history of longevity in my family. I'm receiving a spousal benefit. My husband decided to file at age 66, because his family history is not as good. I receive a reduced spousal benefit and am told I will receive a reduced SS benefit due to the Windfall Elimination Program. No one in the office where I've gone seems to understand this...and I've tried to read and understand it...but it doesn't make sense. The benefit I receive is nominal from a short stint teaching in CA...and the way I see it, that is my money that I contributed and am now due. Can you/will you please tell me how to assure that the calculation I'm given is trustworthy? Or...are we just "stuck", because it is their computer?! Thanks so much for this great article, and I will be continuing to read your writings. Do you think those of us this age will see a significant portion of our SS reduced in the future? My husband and I have tried to be conscientious savers by sacrificing, and it seems wrong to punish those of us because we sacrificed to save so we would "have two nickels to rub together" when we're older. Again, thanks so much for your insight and taking the time to respond.


Most likely, you are or will be affected by both the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO). Both provisions were passed into law by congress in the 1970's & 1980's, and both target 'double dipping'.

WEP affects benefits payable on a person's own Social Security record by using a less generous calculation formula for people receiving a pension based on their on work for an employer that was exempt from paying Social Security tax. Most commonly, this involves foreign work, or work for a local, state or federal government agency. Under this provision, monthly Social Security payments can be reduced by as much as a bit over $400, but not more than one-half of the amount of the full non-covered pension. You can be exempt from the WEP reduction if you have at least 30 years of 'substantial earnings' (see from employment on which you paid Social Security taxes, and you can lessen the reduction if you have between 20 & 30 years of such work.

GPO affects benefits payable on a spouse's record, including divorced and deceased spouses. Under this provision, Social Security spousal, divorcee and widow(er)'s benefits are reduced by two-thirds of the amount of pensions received by the beneficiary based on their work for local, state or federal government employers exempt from paying Social Security taxes. One significant difference between WEP and GPO is that pensions from foreign employers do not count for GPO purposes, whereas they do count for WEP in most cases.

You state that you are receiving a reduced spousal benefit, but I don't know if you mean that it's reduced because you filed prior to full retirement age, or reduced due to the GPO. If you filed prior to full retirement age (FRA), you would have been deemed to have also applied on your own record at that time, so I assume you mean that you applied at FRA for spousal benefits only. That would mean that you can switch to your own account at age 70, at which time your benefit rate will be at it's highest point. Unfortunately, because of WEP, it will be reduced by the lesser of one-half of your non-covered pension, or around $400 give or take. There's no need to switch if you aren't due a higher rate on your own account.

Finally, I don't believe that you will see any substantial reduction in your future benefits. At worst, I think, future cost of living adjustments may be changed to a less generous formula.

Best, Jerry

Jun 24 2016 - 2:45pm
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