I entered federal civil service as a civilian in Dec 1981 under CSRS. I left federal civil service in Jan 1992 & worked in the private sector. I returned to federal civil service in Apr 2008 under CSRS offset. I plan to retire Jun 2022. I have 33 years of social security substantial earnings. Will I experience any reduction from my CSRS or social security benefit at 62?
Blocked by moderator
A little background for your information. You were vested in CSRS, meaning you had 5 or more years, when you left federal service in January 1992. When you returned in April 2008, since your break in service was more than one year, you could not return to “pure” CSRS, you were required to come in under CSRS Offset and should have had a 6-month opportunity to elect FERS. Since you remained in CSRS Offset, you are paying into the retirement system, however you are paying in at the rate of .8% going to the Civil Service Retirement & Disability Fund and 6.2% going into Social Security, whereas pure CSRS employees pay the full 7% into the CSRDF. This means that when you retire in June 2022, if you are younger than age 62, you will collect a pension solely calculated under the CSRS formula. However, once you turn age 62, even if you elect to not draw against your Social Security at that time, your CSRS retirement will be reduced or “offset” by the amount of Social Security that you have earned while sitting in a CSRS Offset position, or in your case for 22 years 2 months of your 33-year Social Security benefit. Again, this is due to the fact that during these 22 years and 2 months, you have been paying the majority of your retirement contributions into your Social Security account and only .8% into the CSRDF. The second part to your question is how your Social Security will be calculated. There is a regular computation and the Windfall Elimination Provision computation. If you truly have 30 or more years of substantial security earnings, you will have your Social Security benefit calculated under the regular computation, not the WEP computation which produces a smaller benefit amount. A shortcut to determine how much of your SSA benefit will be taken from your CSRS benefit is: Multiply your age 62 SSA benefit from your latest SSA benefit statement x 22 (the number of years you will be in an offset position) = $X. Then divide $X by the number 40. The answer will be the estimated amount that will be taken from your CSRS annuity. Example: $900 x 22 years = $19,800 / 40 = $495. You will then collect the reduced or offset CSRS annuity plus 100% of your earned SSA benefit. More information can be found at: https://ask.fedweek.com/federal-retirement/calculating-federal-annuity/
Blocked by moderator
Please sign in to post questions - it's free..