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Federal Employees Benefits Q &A

Do you have questions about your federal employee CSRS or FERS pension/annuity or federal employee retirement planning? Concerns about your Thrift Savings Plan (TSP) account or what about federal employee pay and leave issues?

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The Q&A forum is moderated by Ed Zurndorfer -- an expert on federal employee benefits -- and a Certified Financial Planner, chartered life underwriter and chartered financial consultant in Maryland.

Zurndorfer is also the author of several federal employee benefits guides published by Federal Employees News Digest.

Your question will be put into a message queue and submitted for review. We cannot guarantee that all questions will be answered, however any answered questions will appear below, and some will also be featured in our daily Federal Daily e-newsletter (Subscribe here). Federal Soup users should not submit replies to the questions posted, as we leave the replies for the moderator only. Any replies to questions other than the moderator will be deleted.

Please do not submit employee benefits questions to the webmaster or the forum moderator.

Note: FederalSoup.com has attempted to compile information that is as accurate and current as possible for federal employees. Federal policies, laws, regulations, statistics and addresses continually change. Therefore, no warranties are made as to the accuracy or completeness of the information presented in this column. If additional clarification or information is needed, it is suggested that competent and professional assistance be sought. Mr. Zurndorfer does not moderate other forums on FederalSoup and will not reply to general FederalSoup inquiries submitted in this Q&A forum.

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chappy  
#1 Posted : Tuesday, November 06, 2018 1:59:06 PM(UTC)

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I am currently a CSRS-0ffset employee( less then 14000 of us are still active) and intend to retire late in 2019. During that time I will have turned 66 and would become fully eligible for my social security benefit. My spouse currently received Social Security under her own work record. Once I do file, my benefits will be about $200 month more than my spouse.
I request clarication on the following:
1. Am I correct, that once I file for my SS benefits we have to decide under whose benefit we will be receiving? I believe we can’t both receive our separately earned benefits.
2. Once I retire, if I have not previously applied for my SS benefits, I must do so at that time. I calculated that about 80% of my SS benefit is subject to offset. So regardless if I file for my benefits or choose not to, my CSRS pension will be reduced to an amount equal to the 80% amount. ( I think that % of Offset only occurs at the time I file for my benefits.)
3. Now here’s a twist. If I choose to file under my wife’s benefits what is the Offset? Is it still 80% of my benefit or will the offset be based on what I receive as a spouse receiving benefits under my spouse’s benefits? What’s the best strategy here?
4. Assume I choose the scenario above regardless of its impact but, at age 70 I file for my benefits, would my offset% still be at 80% based on my benefits?
5. When I do turn 66, should I apply for spousal benefits, accept them for the six or seven months before I retire, thereby allowing my benefit to grow about 4%, then file for my benefit? (Also, if not mistaken, my spousal benefit would be 50% of my wife’s benefit plus about $100 more to equal half of my benefit, true?)

Thank you ever so much for your guidance.
Ed Zurndorfer  
#2 Posted : Wednesday, November 07, 2018 4:19:38 PM(UTC)

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In answer to your questions: (1) With regard to Social Security benefits, assuming that your spouse's Social Security monthly retirement benefit, then once you elect to start drawing your Social Security monthly benefit, then your spouse will continue to receive her monthly benefit and you will receive your monthly benefit. There is no law that says that the two of you cannot receive your own earned Social Security benefit; (2)No, you are not correct about how much of your CSRS annuity (not your Social Security) is subject to the offset. The offset is calculated based on the amount of your Social Security benefit you earned as a CSRS offset employee. (3) The offset amount will not be affected if you elect to receive half of your wife's Social Security once you become age 66. The best strategy for you would be to start receiving half of your wife's Social Security monthly benefit once you become age 70 and delay receiving your Social Security benefit until you are age 70. In so doing, you will permanently increase your Social Security benefit by 32 percent. (4) Your offset amount is calculated as discussed previously and has nothing to do when you start receiving your Social Security monthly benefit; (5) Once you become age 66, you could start receiving half of your wife's Social Security monthly benefit, and at a later age you can file for your own larger Social Security benefit, a result of receiving 8 percent annual delayed retirement credit until you are age 70.
chappy  
#3 Posted : Wednesday, November 07, 2018 6:57:36 PM(UTC)

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Thank you. I never realized that each spouse could pull their full benefit. I thought we would be required to claim the highest monthly payout and receive that payment and the other spouse receiving a payment equal to 50% of the higher monthly benefit. (for example: $2000/1000, instead of us each receiving our own earned benefit $2000/$1800).
Ed Zurndorfer  
#4 Posted : Thursday, November 08, 2018 3:08:09 AM(UTC)

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You are most welcome.
SD Analyst  
#5 Posted : Thursday, November 08, 2018 3:20:14 PM(UTC)
S D Analyst

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Just wanted to add something I recently discovered. I, too, am CSRS-Offset and still working as a Federal employee. Once you reach your full SS age (66 and 2 months, in my case) and are still working as a Fed, you can file for SS and draw your own benefits and will not be subject to the WEP (Windfall Elimination Provision). Once you retire as a Fed, your SS payments will then be subject to the WEP and are basically cut in half. Please note, this is not the CSRS "offset" that reduces the amount of your pension by the years you have worked as an CSRS-Offset employee. It's just the WEP that affects your Social Security.

As noted, there are very few of us CSRS-Offset still around, and fewer still HR types who understand our retirement system. I have made a concerted effort to find out everything I can so I don't face any unpleasant surprises when I finally do retire.
Ed Zurndorfer  
#6 Posted : Thursday, November 08, 2018 4:11:35 PM(UTC)

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You are absolutely correct and thank you for your input into this forum.
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