Join Early Retirement Today
Thread Tools Search this Thread Display Modes
Old 09-02-2016, 08:46 AM   #121
Thinks s/he gets paid by the post
Huston55's Avatar
Join Date: Jul 2011
Location: The Bay Area
Posts: 2,037
Originally Posted by Mulligan View Post
It would be for me, also Terry. But I would bet there is a less than 5% chance. This has floated around congress for decades with no action. I suspect it would damage the already ailing trust fund and that alone I would guess (along with history of previous attempts) will prevent it from ever happening. But we can always hope, but not spend it yet.

Sent from my iPad using Tapatalk
I'm diverting this thread a bit but, it's likely important to many of us. It seems this proposal would actually increase SS Trust Fund revenue because, it's a "rob 11 Peters to pay one Paul" scheme.

The Windfall Elimination Provision Repeal: What You Should Know - Social Security Intelligence

See the excerpts below, with my bolding.

You may be thinking that you’ve heard all this talk about Social Security fairness before. You’re right – it’s been discussed for years. But this measure has a really good chance of passing for three reasons.

The bill will save the SSA money – This isn’t the first time that an effort to repeal the WEP has surfaced. There have been many such attempts in years past. None of those ever made it far in the lawmaking process due to the very high cost of a full WEP repeal. However, this bill would not increase the deficit. In fact, the Social Security Administration’s Office of the Chief Actuary found that these changes would actually have a positive financial effect!

A Larger Affected Group

In the past, one of the basic requirements for the WEP penalty was to have not only worked in non-covered employment, but to have qualified for a pension from that work. Under the new formula, that requirement would go away. Moving forward, the only requirement to have the PSF applied would be one year of non-covered earnings. This new requirement will dramatically expand the group that is subject to a Social Security benefit reduction. The Social Security Office of the Chief Actuary said: “Our estimate reflects small benefit reductions from the PSF for a relatively large number of workers who would not be reduced by the WEP.”

This expansion to a larger pool of individuals is one of the main areas that makes this new law cost-neutral. In fact, the actuary’s report states that adding the one year requirement will increase revenue by $2.7 billion for years 2017-2023!

Although many will be happy the new rule is increasing their benefits, many will begin to see a reduction in benefits for the first time.

As currently written, the new rule will be fully effective for those turning 62 in 2017 or later.

According to Dr. Andy Szakmary, a Professor of Finance at Richmond University, there will be 11 losers for every winner under this legislation.

He went on to say.

14 MILLION PEOPLE (according to Goss’ testimony) will become newly subject to the WEP and have their SS benefit reduced, versus 1.25 million people who will receive a higher benefit than under the current formula – so there will be 11 losers for every winner. This is why the bill is much more than revenue neutral – it actually saves SS tons of money. But it does so on the backs of many millions of innocent people who did nothing wrong, in most cases having worked in government or non-profit employment for only a few years, and who cannot now travel back in time and retroactively change their work histories. It would be one thing to pass a bill stating that, from this point forward, if you work in non-covered employment your SS benefit will be 1/35 = 2.86% lower for each year that you do so, but to completely alter the formula, suddenly remove all exemptions and dramatically change the rules for a 61-year-old right before he/she becomes eligible for benefits (as HR 711 does) is infinitely more unfair than sticking with the current system, which has been in place since 1983 and for which current retirees arguably should be prepared. At least President Obama’s proposal, which is similar to HR 711 in its formula, would not be implemented until 2027 and thus would not impact anyone currently close to retirement.”

You may be whatever you resolve to be.
Huston55 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 09-05-2016, 11:04 AM   #122
Thinks s/he gets paid by the post
Join Date: Jun 2014
Posts: 1,790
11 losers for every winner is terrible! It would benefit me but I hope it does not pass. If you are not vested for a public pension you are being penalized for nothing. That is horrible.

Teacher Terry is online now   Reply With Quote
Old 09-05-2016, 11:46 AM   #123
Thinks s/he gets paid by the post
Join Date: Oct 2009
Posts: 1,012
Pardon my ignorance on WEP. It hasn't been an issue for me. However, should I interpret this change to mean that if you have a year, or years from ER, that have zero FICA tax paid that that would factor in more punitively in calculating your SS payment? I assume not, but...

Sent from my iPad using Early Retirement Forum
LARS is offline   Reply With Quote
Old 09-05-2016, 11:56 AM   #124
Thinks s/he gets paid by the post
Join Date: Jun 2014
Posts: 1,790
If you have a year with an employer that does not pay into SS whether you are vested for a pension or not. Really unfair.
Teacher Terry is online now   Reply With Quote
Old 09-05-2016, 12:47 PM   #125
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,980
DW was affected by WEP. Her SS was reduced by about 85% of the amount of her teachers retirement pension. During her school district days (7 years) she did not contribute to SS. You don't pay, you don't get.

Seems fair to me.

Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote

Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off

Similar Threads
Thread Thread Starter Forum Replies Last Post
Any municipal pension recipients working on 'plan Bs'? jon-nyc FIRE and Money 25 10-03-2013 07:38 PM
States Consider Drug Tests for Welfare Recipients samclem FIRE Related Public Policy 46 04-03-2009 07:20 PM
Stimulus for SS Recipients OAG FIRE and Money 2 02-19-2009 04:06 PM
SS recipients get 2.3% raise... Achiever51 FIRE and Money 6 10-18-2007 09:02 AM


All times are GMT -6. The time now is 04:49 PM.
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2018, vBulletin Solutions, Inc.