Does a State Pension Reduce Social Security?

[Craig]

Still strategizing how to leave 70 hour weeks behind, and create a pension in a few years ...

If I took a state job, their 'net calculator indicates I could generate a $400/month pension after only working for 5 years, at a relatively low rate of pay (relative to private employment, etc.)

Do pensions from states affect social security benefits in any way, or is this "found" money?

Living in TN, and it appears there are a fair number of jobs with the state that I qualify for. Any suggestions on how to cultivate contacts or otherwise improve chances for state hire will be appreciated. While contrary to my past perspectives, this appears to be a reasonable way to slow down at the end of my career, work 5 more years or so, enjoy life a bit (working near 40 hours a week will feel part-time), get to know my kids again, and cruise to the finish line. We'll see ...

Thanks much.

 

[Hyperborea]

Do pensions from states affect social security benefits in any way, or is this "found" money?

I think the only pensions that affect SS are the ones earned while not paying SS taxes.  So this is old style federal employee pensions, social security-like payments from other countries systems, etc.  This is under the "windfall elimination provision". Will you be paying SS in that job?

 

[Bookm]

Greetings Charles:

Do pensions from states affect social security benefits in any way, or is this "found" money?

Will the state job pay into Social Security? Some government jobs don't. In any event, you'll receive Social Security benefits in addition to any state pension benefit you're entitled to. Unless you retire due to a disability, your Social Security benefit does not affect your state pension. Also, retirement benefits are generally subject to federal and state income taxes.

Have you looked at the IRS website for the applicable publication? I'm not certain which one it is, but seem to recall it's in the 500's, IIRC. You could get a whole bunch more on the topic.

Bookm

 

[Rich]

You'll want to get SS docs "A Pension From Work Not Covered By Social Security" (SSA Pub # 05-10045) and "Government Pension Offset" (SSA Pub # 05-10007).

 

[Craig]

Great advice all around, thank you. Haven't identified the agency yet, but I'll watch for whether the position will include payment of FICA taxes ... and read up on the pub's noted.

Appreciate the help.