Tag: Retirees

WELL, THIS MORNING, THERE’S SOME GOOD NEWS FOR THE NEARLY 3 MILLION FORMER PUBLIC SERVICE EMPLOYEES WHO PAID INTO SOCIAL SECURITY BUT WERE SUBJECT TO A REDUCTION OR ELIMINATION OF BENEFITS BECAUSE OF THE PENSION OFFSETS. THE SOCIAL SECURITY FAIRNESS ACT OF 2024 JUST SIGNED A COUPLE OF WEEKS AGO. IT WILL AFFECT MILLIONS OF RETIREES, MOST NOTABLY FOLKS LIKE TEACHERS, FIREFIGHTERS AND POLICE OFFICERS. SO HERE TO GIVE US A BREAKDOWN OF THE DETAILS ON THIS NEW LAW, IS CAPTRUST VICE PRESIDENT AND FINANCIAL ADVISOR, CATHERINE MCCALL. THANK YOU SO MUCH FOR JOINING US. HAPPY TO BE HERE. OKAY. SO EXPLAIN A LITTLE BIT OF THE PURPOSE OF THIS LAW AND WHO EXACTLY IT’S GOING TO BE AFFECTING. SO THE PURPOSE WAS TO ELIMINATE THE GOVERNMENT PENSION OFFSET AND THE WINDFALL ELIMINATION PROVISION. SO THOSE ARE TWO PROVISIONS OF THE SOCIAL SECURITY ADMINISTRATION THAT BASICALLY SAY IF YOU WERE PAYING INTO SOCIAL SECURITY, EVEN IF YOU PAID IN THE FULL TEN YEARS TO MAKE YOU AN ELIGIBLE EMPLOYEE, AND THEN YOU GOT ANOTHER JOB IN THE PUBLIC SECTOR AS A TEACHER, AS A FIREFIGHTER, AS A POLICE OFFICER, SORRY, YOU’RE GETTING A PENSION FROM THOSE GUYS, AND YOU’RE NOT GOING TO GET AS MUCH OF A PENSION FROM SOCIAL SECURITY, REGARDLESS OF HOW MUCH YOU PUT IN. SO THIS GETS RID OF THAT LAW AND BASICALLY SAYS, HEY, YOU PAID INTO THIS TIME, YOU AT LEAST GET THE AMOUNT THAT YOU WOULD HAVE EARNED OTHERWISE IN THE FORM OF SOCIAL SECURITY, IN ADDITION TO WHATEVER IT IS YOU EARNED FOR, FOR YOUR GOVERNMENT PENSION. SO GOD, IMAGINE THAT THIS WILL NOT COME WITHOUT SOME COST, JUST A LITTLE BIT. UNFORTUNATELY, IT’S NOT WRITTEN INTO THE LAW SPECIFICALLY HOW WE’RE GOING TO PAY FOR IT. SO, YOU KNOW, A LITTLE BIT OF A BLANK CHECK. GOVERNMENT ESTIMATES RIGHT NOW ARE THAT THIS IS GOING TO COST ADDITIONAL COSTS OF $200 BILLION OVER THE NEXT TEN YEARS, BECAUSE THERE’S MORE MONEY BEING PAID OUT BY SOCIAL SECURITY ADMINISTRATION. BY THE WAY, WE’RE ON THE WAY TO INSOLVENCY. SO THIS ADDS ANOTHER HALF A YEAR TOWARD CLOSER TOWARDS INSOLVENCY FOR SOCIAL SECURITY ADMINISTRATION. SO DEFINITELY SOME SOME IMPORTANT DECISIONS TO BE MADE IN THE NOT TOO DISTANT FUTURE. ON THE OVERALL PROGRAM. BUT NOT GOOD RIGHT. GOOD GOOD BUT NOT GOOD. DEPENDING ON YOUR PERSPECTIVE. YEAH, ABSOLUTELY. AND A LOT OF THAT PERSPECTIVE, A LOT OF THAT PERSPECTIVE REALLY DEPENDS ON TIMELINE. SO WHEN DOES THIS TAKE EFFECT. AND WHAT SHOULD BENEFICIARIES KEEP IN MIND AS WELL. SO IF YOU PAID INTO SOCIAL SECURITY FOR AT LEAST TEN YEARS THAT MAKES YOU AN ELIGIBLE RECIPIENT OF SOCIAL SECURITY, REGARDLESS OF WHETHER OR NOT YOU WENT OUT AND GOT A PUBLIC SECTOR JOB. IF YOU ARE ELIGIBLE AND ARE CURRENTLY RECEIVING SOCIAL SECURITY, THE ADMINISTRATION, THE SOCIAL SECURITY ADMINISTRATION ACTUALLY ALREADY KNOWS THAT YOU WERE SUBJECT TO THE WINDFALL ELIMINATION PROVISION AND THE GPO, THE GOVERNMENT PENSION OFFSET THAT WILL ACTUALLY KICK IN AUTOMATICALLY. THE INCREASED BENEFIT SHOULD KICK IN AUTOMATICALLY BECAUSE THEY ALREADY HAVE THAT INFORMATION. OKAY. SO ONCE THEY ACTUALLY START DOING THIS, THE LAW SAYS THAT THEY HAVE TO START PAYING AN ADDITIONAL AMOUNT OUT BY DECEMBER OF THIS YEAR. OH OKAY. SO THERE IS A LITTLE BIT DATES TO JANUARY OF 2024. SO YOU COULD GET A BIG CHUNK OF MONEY. OKAY. SO IT COULD BE A LUMP SUM. OKAY. TO BACK INTO THAT NUMBER. UNFORTUNATELY THE SOCIAL SECURITY ADMINISTRATION IS STILL READING THE LAW AND TRYING TO FIGURE OUT HOW TO IMPLEMENT IT. SO THERE’S NO SPECIFIC TIMELINE ON WHEN THAT’S COMING OUT. ALL RIGHT. SO DO A FAVOR AND MAYBE KEEP US POSTED ON WHEN THAT CHANGE STARTS TO HAPPEN. BECAUSE AGAIN, SOUNDS PRETTY FLUID AS WELL. AB