What Is The Government Pension Offset?
Will I Lose My Social Security Benefit?
Caller #5-Marge-Why don’t people say anything about the WEP (Windfall Elimination Provision) and the GPO (Government Pension Offset) for Social Security?
Answer-The show has talked about these, but it’s a good time to talk about it again. We’ve helped a lot of workers who get the “Short end of the Stick” with these.
Marge-Do you think it will ever be repealed?
Marge-In other words my husband who paid in for himself and his business, he was self-employed, and I also paid in fully. I lose 2/3 of everything?
Answer-Yes, but technically no.
The Government Pension Offset applies here. If you worked in a Government job and paid into a pension and did not pay into Social Security, when your spouse dies, you do not receive both your pension and their full Social Security benefit. Social Security will deduct 2/3 of your pension amount from your spouse’s Social Security payment.
Here’s the logic. If two individuals of a married couple work in private sector jobs and both contribute to Social Security, when one dies, the other is entitled to only one benefit. They will receive the higher payment of 1. payment on their own record or 2. payment on their spouse’s record. They lose one benefit entirely.
The Government Pension Offset is modeled after this and is in place to prevent a worker from collecting both his own benefit AND a survivor benefit on their spouse’s record.
The person subject to the GPO actually makes out better in most cases than those that worked exclusively in the private sector as they do get 1/3 of their spouse’s Social Security benefit and the other does not get anything.
The truth is everyone in both of these circumstances gets the “Short end of the Stick” as they all lose funds that their spouse contributed. It seems unfair and upsets many people.
Aside from that, the main problem with the GPO is that many people do not know about it. It can be a shock to learn that they are not going to receive what they expected. If they don’t consider this when planning their retirement, they may over-estimate their income, which could have serious consequences.
Josh has helped many workers subject to WEP and GPO plans. You can call his office at 1-888-988-JOSH.
Josh Jalinski, the Financial Quarterback, WOR Radio NYC and Donna Davis Answer Caller’s Questions