Will This Retirement Perk Ruin My Social Security Spousal Benefit?

Unhappy senior woman
Photo by SpeedKingz / Shutterstock.com

Welcome to the Social Security Q&A. You ask a Social Security question, our expert provides the answer.

You can learn how to ask a question of your own below. And if you would like a personalized report detailing your optimal Social Security claiming strategy, click here. Check it out: It could result in receiving thousands of dollars more in benefits over your lifetime!

Today’s question comes from Judy:

“I receive a federal CSRS pension and I am not eligible for any Social Security benefits on my own record. In several months, my husband will claim his Social Security benefits. I believe I will then be eligible for a spousal benefit on his record. I also read that my spousal benefit will be reduced because of my federal pension. What can I do to maximize my Social Security spousal benefit?”

How a ‘ruthless provision’ kills Social Security benefits

Judy, there are several million people who may be in similar circumstances. About 2 million federal Civil Service Retirement System (CSRS) retirees have no Social Security on their own account. Moreover, many state and local retirees are not eligible for Social Security, since they paid into an alternative pension arrangement during their working years.

In addition, some public sector retirees worked enough years in covered employment to qualify for Social Security benefits in addition to their government pension.

Judy, let’s consider your case first. You are indeed potentially eligible for spousal benefits on your husband’s record. However, there is a strong chance that you will not actually receive anything.

You are affected by the Government Pension Offset (GPO) provision. This is a ruthless provision that can eliminate your potential spousal benefit. It may even eliminate your potential Social Security widow’s benefit.

The GPO reduces your potential Social Security spousal benefit by $2 for every $3 of pension benefit (provided that the pension is based on employment not covered by Social Security). To illustrate, suppose your husband’s Social Security benefit at his full employment age (FRA) is $2,400 a month. Your maximum potential spousal benefit, therefore, is $1,200. If your government pension is $1,800 a month or more, you will get nothing in Social Security spousal benefits.

Now, if your husband claims his benefit at his FRA, your potential widow’s benefit is $2,400. It follows that if your government pension is $3,600 or more, you get no widow’s benefit from Social Security.

As noted above, some retirees have a government pension (from work not covered by Social Security) and they qualify for some Social Security benefits from at least 40 quarters of work in covered employment. In addition to being affected by the GPO, they are also affected by the Windfall Elimination Provision (WEP).

While the GPO reduces spousal benefits, the WEP reduces one’s retirement benefits. For those with fewer than 20 years of substantial earnings taxed by Social Security, retirement benefits are reduced by about $55 for every $100 in pension benefits, up to a maximum reduction of $480 a month in 2020. The WEP penalty declines as the number of years of covered employment increases beyond 20 years, reaching zero at 30 years of covered employment.

Got a question you’d like answered?

You can ask a question simply by hitting “reply” to our email newsletter, just as you would with any email in your inbox. If you’re not subscribed, fix that right now by clicking here. It’s free, only takes a few seconds, and will get you valuable information every day!

The questions I’m likeliest to answer are those that will interest other readers. So, it’s better not to ask for super-specific advice that applies only to you.

About me

I hold a doctorate in economics from the University of Wisconsin and taught economics at the University of Delaware for many years.

In 2009, I co-founded SocialSecurityChoices.com, an internet company that provides advice on Social Security claiming decisions. You can learn more about that by clicking here.

Disclaimer: We strive to provide accurate information with regard to the subject matter covered. It is offered with the understanding that we are not offering legal, accounting, investment or other professional advice or services, and that the SSA alone makes all final determinations on your eligibility for benefits and the benefit amounts. Our advice on claiming strategies does not comprise a comprehensive financial plan. You should consult with your financial adviser regarding your individual situation.

Find the right financial adviser

Finding a financial adviser you can trust doesn't have to be hard. A great place to start is with SmartAsset's free financial adviser matching tool, which connects you with up to three qualified financial advisers in five minutes. Each adviser is vetted by SmartAsset and is legally required to act in your best interests.

If you're ready to be matched with local advisers who will help you reach your financial goals, get started now.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
5 Cheap and Easy Ways to Make Your Car Smell Delightful
5 Cheap and Easy Ways to Make Your Car Smell Delightful

These tips will leave your ride smelling delightful for next to nothing. Some options are also chemical-free.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

10 Purchases You Should Not Put on a Credit Card
10 Purchases You Should Not Put on a Credit Card

Credit cards offer many conveniences and protections, but sometimes it’s simply smarter to keep the plastic tucked away.

What’s the Difference Between FICO and VantageScore Credit Scores?
What’s the Difference Between FICO and VantageScore Credit Scores?

There are lots of credit scores out there, but if you’re keeping an eye on your credit, here’s the one to watch.

7 Things I Never Buy at Costco
7 Things I Never Buy at Costco

A bulk buy isn’t always the best buy. Here’s where I shop for these items instead of a warehouse club.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
This Gas Station Scam Is Victimizing More Drivers
This Gas Station Scam Is Victimizing More Drivers

For the second straight year, a growing number of Americans believe they’ve fallen prey to this scam.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

7 Unusual Ways to Declutter Your Home
7 Unusual Ways to Declutter Your Home

Tired of possessions weighing you down? Here are seven ways to declutter painlessly and effectively.

This Is the Most Popular Age for Claiming Social Security
This Is the Most Popular Age for Claiming Social Security

Both men and women are most likely to start receiving Social Security benefits at this age.

21 Things You Should Always Buy at a Dollar Store
21 Things You Should Always Buy at a Dollar Store

Dollar stores have great bargains on both everyday and occasional purchases.

6 Things You Should Never Buy at Trader Joe’s
6 Things You Should Never Buy at Trader Joe’s

We love Trader Joe’s for plenty of reasons. But think twice about this handful of products.

Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?
Could You Give Up These 7 Expenses to Save Thousands of Dollars a Year?

You could save more than $30,000 by setting aside these costly expenses for just one year.

Don’t Toss These 7 Household Items — Sell Them
Don’t Toss These 7 Household Items — Sell Them

Here’s how to earn cash as you give new life to these unwanted items.

6 Legal Documents Retirees Need — but Don’t Have
6 Legal Documents Retirees Need — but Don’t Have

Few retirees have these documents that are crucial to their golden years — especially during a pandemic.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

Eat This Food If You Want to Avoid Alzheimer’s Disease
Eat This Food If You Want to Avoid Alzheimer’s Disease

One type of food associated with the Mediterranean diet offers especially large benefits.

5 Awesome Places You Can Retire Overseas on $2,000 a Month or Less
5 Awesome Places You Can Retire Overseas on $2,000 a Month or Less

In this week’s podcast: tips on retiring overseas — from someone who’s been helping American expats for decades.

11 Expenses That Quietly Drain Your Wallet
11 Expenses That Quietly Drain Your Wallet

It’s scandalously easy to overspend in these areas of your life.

9 Dumb Ways You Are Ruining Your Home Value
9 Dumb Ways You Are Ruining Your Home Value

Homeowners, beware these mistakes that can drive away potential buyers.

18 Amazon Purchases That We Are Loving Right Now
18 Amazon Purchases That We Are Loving Right Now

These practical products make everyday life a little easier.

7 Tips for Building an Emergency Stockpile
7 Tips for Building an Emergency Stockpile

A pandemic or natural disaster could leave you reliant on your existing food supply. Is your pantry prepared?

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

15 Outrageously Overpriced Products — and How to Save on Them
15 Outrageously Overpriced Products — and How to Save on Them

Retailers mark up products by hundreds of times their cost — but you don’t have to pay the premium.

Why Half of Retirees Now Owe Taxes on Social Security
Why Half of Retirees Now Owe Taxes on Social Security

Growing numbers of seniors are paying taxes on their Social Security benefits, but you might be able to avoid this fate.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.