Today I am 62 +1 day. Here's my question. Back in 2010, I retired from my local fire department at the age of 50. My pension is a state of Florida defined benefit plan. Even though it was a state pension we were still in SS. After I retired I went to work for a neighboring fire department. Because of their state-defined benefit plan they opted out of SS. It's been 22 years since I paid into SS. They took me off the trucks years ago and put me in the office. This will give me a little longevity in a labor-intensive job. With that said I'm thinking about hanging in for about 3 more years before I pension out for the second time. Can I expect that my benefits will be based on where my salary was in 2010? Currently, I'm listening to Get What's Yours and I haven't heard of my particular scenario yet.
Fire Marshal Joe
Hi Joe. Social Security retirement benefits are based on an average of a person's highest 35 years of Social Security covered wage-indexed earnings (https://www.ssa.gov/oact/progdata/retirebenefit1.html). If you have fewer than 35 years of Social Security covered earnings, then zero earnings years will be used in the averaging. That, of course, would reduce the 35-year average and the resulting benefit rate.
Furthermore, if you receive a pension that's based in whole or in part on your non-Social Security-covered earnings, then your Social Security retirement benefit rate could be reduced due to the Windfall Elimination Provision (WEP)(https://www.ssa.gov/pubs/EN-05-10045.pdf).
The benefit calculator included in our software (https://maximizemysocialsecurity.com/purchase) is fully programmed to handle both WEP and non-WEP calculations, so it sounds like you should strongly consider using the software to determine your best strategy for maximizing your benefits.