Q & A
Calculating the “break-even point” on early Social Security sign-up–how do you factor in the probabilities?
Full Question: I am continually concerned that you and others keep telling people who are eligible for Social Security to delay taking the benefits. Here is how I figure it. I take my Social Security benefit at $1,230 a month. At…
Do I have to pay taxes on my annuity if I went off work on disability retirement?
Answer: Yes, you do. Source: Reg Jones, FederalTimes.com, January 22, 2013
My wife and I are going to do an addition to our house. We’re both 45 years old and have plenty of equity to support $400,000 of borrowing. I was thinking of borrowing from our 401(k) plans. We could pay the interest back to ourselves. My wife is concerned that we will lose the tax deduction and, if something happens, we have no retirement. What are your thoughts?
Answer: Listen to your wife; she’s clearly a wise woman. Borrowing from a 401(k) plan almost never makes sense. It’s an emergency step, not something for daily life. As a practical matter, the interest rate on home equity credit lines…
I got a letter from the National Association of Retiring Federal Employees stating, “Federal agencies are now re-employing federal retirees on a limited part-time basis without an offset to their annuity.” Can you explain this a little further? How would I find and apply for one of these positions?
Answer: Section 112 of Public Law 111-84 effective Oct. 28, 2009, allows a federal agency to hire a retiree and waive the offset between a salary and an annuity. These temporary appointments for a year or less can be made if…
If I take early retirement and still work, will my benefits continue to be reduced because I retired at age 62?
Answer: Social Security will review the age 62 reduction factor when a person reaches full retirement age. At that time, we will determine if there is any month a benefit was not paid because of earnings that exceeded the annual earnings test…
My husband and I have owned and operated a business together for many years, but my Social Security statement does not show any earnings for me. We file joint income tax returns every year. What happened to my share of our earnings?
Answer: If you and your husband own and operate a business together and you share in the profits and losses, you may be entitled to receive Social Security credits as a partner. This may be true even if you and your…
Collecting Spousal Benefits – Impact on Future Benefits 2
Full Question: My wife is 67 and started drawing at her Full Retirement Age (FRA) of 66. I am 63 and have not retired yet. If I were to retire before my FRA (66 as well) and she claimed spousal…
Collecting Spousal Benefits – Impact on Future Benefits
Full Question: My wife is 67 years-old and retired after working 43 years as a Respiratory Therapist and started collecting Social Security benefits at age 65. I will be 68 Feb. 22, 2014. I am still working as a Principal Sourcing…
How do IRA distributions affect Social Security?
Full Question: Hi, I am 63 drawing my Social Security and have been working part time as well. I have a retirement IRA that I would like to start withdrawing from in 2014. I am no longer working part time, so…
I will have 25 years under FERS once I complete the buyback of my military time and 15 years of federal time at age 56. Is it true that I have labored under the misconception of the 80 rule all these years? When I was hired, this information was in my package. I can’t believe I have been looking forward to a full retirement just to hear I will lose more than 30 percent.
Answer: The “80 rule” is a bit of folklore that’s been rattling around for decades. It has no basis in fact. No CSRS employee has ever been able to retire on an unreduced annuity when his age and years of service…