Q. After working for approximately 11 years in the private sector and paying into Social Security, I joined the Foreign Service in March 1979. I resigned in July 1983 to get married and start a family. I got back the $4,000 I paid into my retirement. In June 1985, I rejoined the Foreign Service and because my original separation was for the purpose of marriage, I was brought back on at the same grade and step level I was at, my leave balances at the time of my separation were reinstated, and I continued to earn annual and sick leave at the same rate had I never left the Foreign Service. When I was reinstated, I had to pay into both Social Security and Foreign Service retirement systems.
On Nov. 20, 2003, I retired from the Foreign Service and began to collect my annuity, which started out at approximately $25,000 annually. On Dec. 1, 2003, I became a contractor and continued to work at (the same job) at the State Department and I have been a contractor working full time without a break ever since December 2003. I continue to receive my full annuity, as well, which is currently approximately $30,000 annually.
I have, to date, paid into Social Security for almost 38 full years.
I am wondering how I can figure out how much my annuity will be reduced when I reach 62 next year (April 2013).
You state: “your CSRS annuity will be offset only by the amount of Social Security benefit you earned while covered by CSRS Offset,” but how do I calculate that amount? I began paying Social Security while employed by the government in June 1985. I retired from federal service and began collecting an annuity December 2003. That’s 18 years I paid into both. Can you please tell me how to do the math so I am not completely financially shocked when they start the cut? And may I assume that when I do finally collect my Social Security pension at age 67, God willing, it will be the entire amount I have earned, plus whatever I am currently receiving from my Foreign Service pension?
A. When you reach age 62, if you are retired, your CSRS annuity will be offset by the amount of Social Security benefit you earned while a CSRS Offset employee. The amount you receive will be the same. It will just come from two difference places: the Office of Personnel Management and the Social Security Administration. To estimate what the offset would be, use the following formula: Your Social Security benefit estimate at age 62 x your years of offset service rounded to the nearest whole number ÷ 40. If you retire at or after age 62, the offset will occur of the day you retire.