Ask Larry

Why Am I Being Penalized For Working For The Railroad?

Larry, I worked for the railroad from 2006-2022. I left the railroad and working full time. I plan on working till I am 65. I look at my social security statement and it shows 0 dollars obviously for the years of railroad time, however I keep seeing that when I retire RRB reduces my tier 1 dollar for dollar of Social Security Security. With this method my Social Security doesn't take into account my years of railroad service and then I am really losing money. Instead of double dipping I am being double penalized and getting way less. How is this possible.

Hi. I should preface by saying that my expertise is limited to Social Security (SS) benefits. It doesn't extend to Railroad Retirement (RR) benefits. While it's true that the Railroad Retirement Board (RRB) reduces Tier 1 RR benefits dollar for dollar by the amount of SS benefits a person receives, the reason they do so is because Tier 1 benefits are calculated using both the worker's Social Security and Railroad earnings ( So, if there was no offset, the same earnings could be used in both benefit calculations.

With regard to your Social Security retirement benefits, those benefits are calculated based only on your Social Security covered earnings. No railroad earnings are used, unless the worker doesn't have enough railroad earnings to qualify for a separate RR pension. There are some potential claiming strategies that can be advantageous for a person with your options, but the best strategy depends on your comparative RR & SS benefit rates. Our software ( can help you determine your SS benefit rates and claiming options, but you'll probably also want to discuss your RR options with an RRB representative.

Best, Jerry

Oct 13 2022 - 11:51am
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