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DW's SS benefit - I apologize ahead of time....
Old 03-18-2012, 11:20 AM   #1
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DW's SS benefit - I apologize ahead of time....

I know these types of questions get asked a lot around here and I know the mods politely suggest searching the SSA site and earlier posts on E-R.org.

I have searched both for several hours. Sometimes I feel like I am homing in on an answer I am happy with, but I am not quite there. Please bear with me.....

DW spent the 1st part of her career working as an educator in a system that participated in SS, took some time off for kids and has spent (and will spend) her remaining working days in a system that doesn't participate in SS (mandatory 403 (b)).

In the first part of her career, between full-time and part-time work, she hit 40 quarters in SS. We get a statement from SSA for her with a projected benefit and a detailed list of contributions by year. Because it is from her early career and has not increased in years, the projected benefit is less than half of mine.

DW's pension will come from the state teachers retirement system and is based on the years in both a non-SSA system and an SSA system. We can guesstimate that amount.

For the higher-earning years in a non-SSA school system, she will receive an annuity from TIAA-CREF. We can guesstimate that amount.

I am having a dickens of a time guesstimating what she will get from SSA as result of her years contributing to SS.

There is the WEP aspect......

Since her SS benefit is less than half mine, there are when and who retires considerations.....

I am feeling kinda dumb but I can't seem to get an idea on how DW's SS benefit will play out.

The thing is: We've still got a ways to go (8 years). I am not looking for precision - I am just not sure how to get to even a guessimate for the many different permutations of who retires when and who starts SS when.

Any insights appreciated......
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Old 03-18-2012, 12:46 PM   #2
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The WEP aspect affects her own social security benefit on her own record. GPO affects the social security benefit that she can possibly receive as a spouse on your record. Go to The United States Social Security Administration and click on how to estimate your retirement benefits. Under Who Can Use this Retirement Calculator you will see Pension Based on Work Not Covered by Social Security in the color blue. Click on this link. This takes you to both the WEP online calculator and the GPO online calculator and they are both in the color blue. These are the calculators that she will need for retirement and possible spouse's benefits. Good luck. SSA's toll-free number is 1-800-772-1213 or your local office if you need help.
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Old 03-18-2012, 12:53 PM   #3
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The SSA website has a tool for estimating. THere are two versions of the tool...a quickie one, and one where you need to enter each year's earnings. Hope this helps.

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Old 03-18-2012, 04:10 PM   #4
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I believe what you need is called the Detailed Calculator.
Here is a page from which you can download it: Compute Your Benefit with our Detailed Calculator

You will have to enter personal info about your DW: age, SS covered earnings record, when to start the SS benefit, other pension amounts and starting dates, etc. as these are variables that go into the WEP calculation.

It will take a little effort but it will be worth it.
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Old 03-19-2012, 06:38 PM   #5
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For a quick estimate, figure she will get around 40% of the benefit shown on her last SS statement. Based on your history, she'd get half your benefit less 2/3 the amount of her annuity. I believe she'll get one or the other, not both.
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Old 03-19-2012, 07:03 PM   #6
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Quote:
Originally Posted by Rustward View Post
I believe what you need is called the Detailed Calculator.
Here is a page from which you can download it: Compute Your Benefit with our Detailed Calculator

You will have to enter personal info about your DW: age, SS covered earnings record, when to start the SS benefit, other pension amounts and starting dates, etc. as these are variables that go into the WEP calculation.

It will take a little effort but it will be worth it.
Thank you Rustward. After a battle with Vista, I downloaded and installed this program. If you love DOS-based programs and C prompts, well, you'll love this thing! It took a while but I slogged through it all.....

Results in next post......
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Old 03-19-2012, 07:07 PM   #7
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Quote:
Originally Posted by akck View Post
For a quick estimate, figure she will get around 40% of the benefit shown on her last SS statement. Based on your history, she'd get half your benefit less 2/3 the amount of her annuity. I believe she'll get one or the other, not both.
Where does the 40% figure come from. The max WEP today is $374 and it can never be more that 50% of the non SS pension received, so you need the levels of SS and non-SS pension and the number of quarters to calculate the reduction.

FYI I will get maximum WEPed because of a state pension, UK SS pension and only having 17 years of US SS contributions. If I take SS when I'm 66 my benefit (in future dollars) is reduced from $2600 to $2000, so I get 77% of the benefit.
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Old 03-19-2012, 07:10 PM   #8
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Quote:
Originally Posted by akck View Post
For a quick estimate, figure she will get around 40% of the benefit shown on her last SS statement. Based on your history, she'd get half your benefit less 2/3 the amount of her annuity. I believe she'll get one or the other, not both.
Thank you akck. Your estimate was basically the answer after going the long route.

Here's what I can't figure out. At the end of DW's tenure, she must annuitize some of the TIAA-CREF funds, but not all. The SSA calculator only acknowledges a non-SSA monthly benefit. Is it as easy as not annuitizing as much as possible to maximize SS benefits? Surely not.....
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Old 03-19-2012, 07:59 PM   #9
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Originally Posted by LRDave View Post
Thank you akck. Your estimate was basically the answer after going the long route.

Here's what I can't figure out. At the end of DW's tenure, she must annuitize some of the TIAA-CREF funds, but not all. The SSA calculator only acknowledges a non-SSA monthly benefit. Is it as easy as not annuitizing as much as possible to maximize SS benefits? Surely not.....
It doesn't matter how much she annuitizes, for purposes of the WEP calculation the SSA (or TIAA-CREF) will calculate a monthly annuity payment based on her entire balance and use that number.
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Old 03-19-2012, 08:05 PM   #10
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Thank you akck. Your estimate was basically the answer after going the long route.
Did you run the WEP calculator? How much are you calculating the reduction in benefit to be? The reduction you come up with is very high, can you give us some figures?
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Old 03-19-2012, 11:00 PM   #11
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Where does the 40% figure come from. The max WEP today is $374 and it can never be more that 50% of the non SS pension received, so you need the levels of SS and non-SS pension and the number of quarters to calculate the reduction.

FYI I will get maximum WEPed because of a state pension, UK SS pension and only having 17 years of US SS contributions. If I take SS when I'm 66 my benefit (in future dollars) is reduced from $2600 to $2000, so I get 77% of the benefit.
Based on the OP's information of lower SS earnings and number of years, the major reduction will be on the first $767 of earnings, with the percentage drop from 90% to 40% because of less than 20 years of contributions. Under these conditions, using the 40% becomes a quick way to estimate the WEP effect. This is what I used for years until I started contributing SS at higher earnings and more years.
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Old 03-19-2012, 11:22 PM   #12
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Originally Posted by LRDave View Post
Thank you akck. Your estimate was basically the answer after going the long route.

Here's what I can't figure out. At the end of DW's tenure, she must annuitize some of the TIAA-CREF funds, but not all. The SSA calculator only acknowledges a non-SSA monthly benefit. Is it as easy as not annuitizing as much as possible to maximize SS benefits? Surely not.....
From what I can tell when running my numbers and changing the pension/annuity number, it has no effect on the benefit from a WEP standpoint. But, from a GPO standpoint, the size of the annuity will make a difference. However, you don't have control over the amount considered for the annuity from a GPO standpoint. Do whatever annuity you want, but get an estimate for the annuity for the full pension amount for the GPO calculation. If you don't, they will use their tables for figuring your benefit.
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