Q. I am a retired federal employee. I retired when I was 58. I started getting my federal retirement and Social Security at that time. I am about to turn 62. I was told that I have to contact a Social Security office and get my benefit changed. Can you explain that?
A. I'm going to start out by giving you half an answer. Then I'm going to give you and the rest of my readers some background information about federal government employees and their relationship to Social Security. After I do that, I will come back and finish answering your question.
First, here is that half-answer. You did NOT start getting Social Security benefits when you retired at age 58. However, you will start getting those benefits when you turn 62. Now, before I elaborate on that, I have to give a bit of a history lesson.
When the Social Security laws were first passed in 1935, Congress figured that federal government employees did not need to be covered by the new program. Why? Because federal employees were already covered by the civil service retirement system. That retirement program has been around since 1920.
Congress also decided that they could not force a federal pension plan (Social Security) on state and local government employees. So, they gave them the option of joining Social Security or not. Most did. And over the years, other state and local groups who did not originally join Social Security eventually signed on to the program. But to this day, there are still large blocks of state and local employees — like teachers in some states, and firefighters and police officers in other states — who are not covered by the Social Security system. (They constitute about 20% of all state and local government workers.)
I have written many past columns aimed at those 20% because they sometimes work on the side at jobs where they do pay into Social Security. Or they are married to someone who has a Social Security-covered job. But they are not the focus of today's column. Today, I am dealing with people who work for the federal government.
Oh, and I am also not dealing today with the other large employer group not covered by Social Security: railroad workers. For reasons a little too complicated to explain in today's column, a separate pension system was set up for employees of our nation's railroads at about the same time Social Security was started.
OK, so now back to federal government employees and Social Security. To repeat, they were not included in the original Social Security Act because they already had their own pension plan that had been around for 15 years before Social Security started.
But over the years, Congress felt an increasing amount of pressure to bring federal employees into the Social Security fold. There were two main reasons. No. 1: you could make the case that all workers in the country should be covered by the same retirement system. (Although to be true to that philosophy, you would have to make all state and local workers and all railroad workers part of the Social Security program, too.)
But reason No. 2 was the bigger factor. And that was that as federal government employees, members of Congress, members of the judiciary system and the president did not pay into Social Security. They were covered by the same civil service retirement system as all other federal employees. And it was politically embarrassing for politicians to be making laws about a retirement program that they were not a part of.
This led to all kinds of conspiracy theories (which still exist to this day) that top members of government get fat and lucrative pensions while scattering crumbs to the peasants in the form of meager Social Security benefits. This was never true. But millions of Americans believed it.
Anyway, by the 1980s, the political pressure to bring federal employees into the Social Security tent was too great. So, in 1983, a law was passed saying that all federal employees hired after Dec. 31, 1983, would be covered by the Social Security system. At the same time, the law decreed that effective Jan. 1, 1984, all members of Congress, the president, the vice president and federal judges would also start paying into Social Security. (So, let's get rid of the myth that politicians are not covered by Social Security. Again, since 1984, they have been.)
The new retirement program that Congress set up was called the Federal Employees Retirement System, or FERS. And they gave all old government employees hired before 1984 the option of switching from the Civil Service Retirement System to FERS. By the way, I was one of those people. I was hired in 1973. I remember that I struggled mightily with that decision. Should I stick with CSRS or switch to FERS? (There were some advantages — too complicated to explain here — to making the switch.) I finally decided to stay with CSRS. And frankly, to this day, I'm not sure I made the right move. I had several friends who switched to FERS, and now that we are all retired, it looks to me like they are a little better off than I am. But that's my problem, not yours.
Anyway, FERS employees had Social Security taxes taken out of their paychecks. And they also had an extra deduction from their salary to fund a federal retirement benefit designed to supplement their Social Security checks. So, old federal retirees like me get just one CSRS pension check each month. But those retirees who are covered by FERS get a Social Security check and a smaller FERS pension check (smaller than CSRS pension checks, that is). But the intent of the program was that a combination of Social Security and FERS benefits should roughly equal what CSRS retirees were getting.
Now, finally, I can finish answering your question. You said you retired from the federal government at age 58. But Social Security checks don't kick in until age 62. So, what the FERS program does is give you a bit of an augmented FERS pension when you first retire. Then, when you turn 62 and apply for Social Security benefits, the government removes the augmented portion of your FERS check — and you should end up just about where you have been all along.
If you have a Social Security question, Tom Margenau has the answer. Contact him at [email protected] To find out more about Tom Margenau and to read past columns and see features from other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.
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