STRS and Social Security

I continue to field many questions from members of STRS Ohio related to their public pension and Social Security benefits. As previously discussed, many members of STRS Ohio assume they are not eligible for both STRS and Social Security benefits, however, that assumption isn’t always accurate. Below are answers to two more questions I frequently receive related to STRS and Social Security.

I’m eligible for spousal Social Security benefits. Will the Windfall Elimination Provision (WEP) or Government Pension Offset (GPO) affect me?

If you are eligible for spousal Social Security benefits based on your spouse’s work record AND an STRS Ohio pension from your own employment, the GPO may reduce apply. The GPO reduces Social Security spousal benefits by an amount equal to two-thirds (2/3) of your STRS Ohio retirement pension.

For example, if you are eligible for spousal Social Security benefits of $10,000 per year and your STRS Ohio retirement pension is $24,000 per year, your spousal Social Security benefits would be reduced by $16,000 ($24,000 x 2/3). In other words, it would be completely eliminated ($10,000-$16,000).

This potential GPO reduction is especially important to consider if you continue to work as a member of STRS Ohio AFTER you begin receiving spousal Social Security benefits. You may receive spousal Social Security benefits for a period of time, but it’s possible your STRS Ohio pension may completely eliminate your spousal Social Security benefits when you retire and begin your pension as an STRS Ohio member.

I recently retired from the private sector and began working as a member of STRS Ohio. Will this impact my Social Security benefits?

The answer is maybe. As a reminder, the Windfall Elimination Provision (WEP) may apply to your Social Security benefits. Social Security provides an online WEP calculator to determine what impact your STRS Ohio pension may have on Social Security benefits.

One item to consider though is that the WEP does not apply if you have 30+ years of substantial earnings under Social Security. In other words, no WEP reduction may apply if your work history as a member of the private sector is long enough and you had sufficient earnings. For a list of what Social Security considers “substantial earnings,” refer to page two of the Windfall Elimination Provision brochure.

In addition, if you retire from STRS Ohio prior to becoming eligible for retirement benefits (5 years of service credit), you may request a lump sum withdrawal of your benefits from STRS Ohio without any impact on your Social Security.

As always, proper planning is the key to understanding your potential benefits and retirement income. Careful consideration should be given to how your STRS Ohio and Social Security benefits affect one another.