CSRS (Civil Service Retirement System) and FERS (Federal Employees Retirement System) retirees are eligible to collect Social Security under certain circumstances. While FERS retirees receive Social Security benefits, CSRS retirees may receive benefits if they worked 40 quarters, 10 years in the private sector. CSRS retiree benefits can be subject to reduction by either GPO (Government Pension Offset) or WEP (Windfall Elimination Provision). GPO affects those who apply for spousal benefits, while WEP affects those filing for their own benefits.
If you’re like many Americans, you may be planning to collect Social Security retirement benefits as soon as you become eligible at age 62. However, just because it’s possible to file for benefits at 62, doesn’t mean that it’s the best choice for you.
For example, did you know that for every year beyond your full retirement age that you postpone collecting Social Security benefits your monthly benefit amount could increase by 8% until age 70? That equates to a maximum increase of up to 32%!
It is important to acquire as much information as possible to make an informed filing decision, because final decisions about Social Security filing strategies always rest with you, and should be based on your individual needs. Some of the factors you should consider before making your decision include (but are not limited to): marital status, age of each spouse, age differential between spouses, earnings records, and health. If you desire to make a change after one year, your options are extremely limited.
How does one go about making the right decision? As the adage goes, the only thing certain in life, is uncertainty. Without knowing when we will die, it is hard to say which filing decision will provide the greatest financial impact for retirees. With the help of your local Social Security office, an experienced financial services professional, or by doing your own research, you can educate yourself on the pros and cons of the options available to you.