Estimating SS benefits when retiring early

[Rustward]

WEP?

Retirement Planner: Windfall Elimination Provision (WEP)

 

[youbet]

For several years there has actually been organized efforts to get the WEP repealed. With the impending shortfall of SS looming, I see little chance of the repeal getting any traction.

Rather than repeal WEP, I think it's more likely that those exempted from SS due to state/municipal pensions will be required to join SS, just as happened to Fed employees. Personally, I think that's a good idea. Until this happens, WEP will be required to keep highly paid (but low SS contributors due to their main job being outside of SS) from being subsidized by SS the same as low wage earners.

 

[jdw_fire]

I'm a WEP'er too, having been a federal employee & not paying into SS from that job since 1982. I did, however, pay into SS between 1973 & 1982, so I basically qualify to get some SS, which I've calculated to be in the $250 - $300 range at age 62 (8 yrs from now). What bugs me a little is that although I stopped paying into SS from my civilian job in 1982, I have paid into SS from my military reserves pay for all of those same years (1981-2010), but will get nothing in return from those contributions, because I didn't earn enough to reach the minimum threshold. I don't think that's fair. I realize I shouldn't get the same as somebody who's paid in much more, but I feel like I oughta get something for that 30 yrs of contributing. The amount I will get is based solely on my earnings prior to the end of 1982, nothing afterwards.

i am thinking you are mistaken about getting "nothing in return from those contributions". granted, you didnt reach the threshold for those years income to be considered substantial and therefore they wont reduce the impact of WEP on your SS benefit calculation. however, all that income still counts towards your SS earnings and therefore you will be getting credit for that income in the computation of your SS benefit, which is something.

 

[Mulligan]

Rather than repeal WEP, I think it's more likely that those exempted from SS due to state/municipal pensions will be required to join SS, just as happened to Fed employees. Personally, I think that's a good idea. Until this happens, WEP will be required to keep highly paid (but low SS contributors due to their main job being outside of SS) from being subsidized by SS the same as low wage earners.

I agree. I don't know why certain groups were allowed to vote out of it in the first place. Our retirement system members voted not to participate back in the 1950's. The WEP wouldn't be causing these problems if you were in the system. What if a pension system gets drastically reduced? With no SS, retirement income could shrink quickly.I know the same could be said about SS, but even when the fund dries up it would still be able to pay out 77% due to incoming receipts. At least that is what is always quoted.

 

[palomalou]

dtbach, there is a VERY clunky and complicated benefit calculator called ANYpia on the ss site (when you finally get in) that will let you calculate what you will get under this circumstance. It looks like something from 1980 and my husband had to do it because I couldn't make heads of tails of it, but it DID give realistic info (that is, it related to the "if you continue earning" and gave me "but if you take a sudden big cut in pay" here is what you will get. Then I've been figuring a 25% cut in benefits (I'm 56 and plan to cut from 150% time work to 50% in a year).
Someone else probably has used this thing too.