Ask Larry

Can I Delay My 401a Pension Payouts Until Age 70 To Defer GPO Offset?

I am trying to find out two things regarding the Government Pension Offset provision: I currently work in higher education that does not pay into SS. I hope to retire soon...I have a 401A pension plan through the university.

My question is twofold:

1. Once I retire, can I delay by 401a pension payouts until 70 in order to get the full Survivor Benefit that is available due to the death of my husband (he paid into SS his whole life)?

I found an article on the SS website that seems to contradict itself, unless my interpretation is wrong.
Section A (3) states that you are eligible for your pension upon retirement and it seems to implicate that even if you defer your payouts until 70 , Social Security WILL STILL count it. with regard to Survivor Benefits.

But then in the example, section (Ex. 1) Jane Doe retired and delayed her payouts until 70 and it seems to implicate that payouts WILL NOT be counted until she starts taking her pension at 70.

2. If delaying 401a payments WILL NOT HELP with Survivor Benefits, does SS have a formula they use to determine your pension payouts with regard to average life expectancy, dollars in 401a, etc. I want to make sure I maximize the two benefits. My financial advisor is encouraging me to establish a 20-year irrevocable lifetime annuity with payouts over 20 years to first me and then my only adult child. Just wondering if that is the only course of action. An earlier advisor told me I didn't need an annuity because I have enough in retirement. A bit confusing.

Just a note...I have enough quarters in SS for entitlement at some point in the future too. But my late husband's service qualifies for a greater benefit.

I hope my questions are written clearly. Thank you for providing this resource.


I'm sorry for your loss.

Generally, Government Pension Offset (GPO) would kick in when a person first becomes entitled to both a survivor or auxiliary benefit from Social Security, and to a government pension based on their earnings that were exempt from Social Security taxes. If the government pension is from a defined contribution plan and if the recipient can control the timing or the amount of the distributions from the plan, the offset amount would be calculated by prorating the lump sum value of the plan as explained in the following section of Social Security's operations manual: Such a proration would start effective with the person's first distribution from the plan, and a distribution would include any of the following:
•A periodic payment (e.g., monthly, bi-weekly, etc.);
•A lump-sum payment;
•A rollover into a personal pension plan (e.g., an IRA, Annuity, etc.); or
•A rollover into a private or government employer’s pension plan based on covered employment.

Therefore, your defined contribution plan shouldn't result in any offset of your survivor benefits at least at least until you receive your first distribution from the plan as described above. Our software ( is programmed to handle lump sum prorations, so you may want to strongly consider using it to help you with your Social Security planning.

Best, Jerry

Apr 26 2020 - 3:04pm
MaxiFi software running on a laptop
Get What's Yours!
Discover tens of thousands in extra retirement dollars with Maximize My Social Security software!
  • Find your maximized strategy
  • Unlimited what-ifs
  • Step-by-Step filing instructions
  • Our software's lifetime-benefit increase for an illustrative couple earning $65K each and planning to take retirement benefits at 62.

    Results will differ based on your specific case and filing strategy.

Getting Started is Easy
Web-based software. Works on ALL browsers. No download.
$40 Annual Household License
$250 Annual Financial Advisor License