Social Security Planning for Your Retirement

What’s Social Security?

Social Security is a federal government program that provides a source of income for you or your legal dependents (spouse, children, or parents) if you qualify for benefits. You also need a Social Security number to get a job.

Find how to apply to get a Social Security number or to replace your Social Security card.

How Do Benefits Work and How Can I Qualify?

While you work, you pay Social Security taxes. This tax money goes into a trust fund that pays benefits to those who are currently retired, to people with disabilities, and to the surviving spouses and children of workers who have died. Each year you work, you’ll get credits to help you become eligible for benefits when it’s time for you to retire. Find all the benefits Social Security Administration (SSA) offers.

There are four main types of benefits that the SSA offers:

• Retirement benefits
• Disability benefits
• Benefits for spouses or other survivors of a family member who’s passed
• Supplemental Security Income (SSI)

How to Open a “my Social Security” Account

If you receive or will receive Social Security benefits, you may want to open a “my Social Security” account. This online account is a service from the SSA that allows you to keep track of and manage your SSA benefits, and allows you to make changes to your Social Security record.

How to Find More Help

If you have specific questions about your Social Security benefits, you can review the Social Security Administration’s frequently asked questions or contact Social Security Administration directly.

Avoiding Errors and Getting Help

If your job is covered by a traditional pension plan, make sure you get the pension amount you’re owed.

• Find ways to protect yourself. Read these 10 common causes of errors in pension calculation.

• Get free legal help if you’re experiencing a problem with your pension plan.

• Find out whether your pension or annuity income is taxable.

• For questions or complaints about your plan, contact your human resources office. Or contact the Employee Benefits Security Administration (EBSA) regional office near you.

Federal Insurance for Private Pensions

If your company runs into financial problems, you’re likely to still get your pension.

The Pension Benefit Guaranty Corporation (PBGC):

• Insures most private-sector defined-benefit pensions. These are plans that typically pay a certain amount each month after you retire.
• Covers most cash-balance plans. Those are defined-benefit pensions that allow you to take a lump-sum distribution.
• Does not cover government and military pensions, 401k plans, IRAs, and certain others.

Is Your Pension Insured?

• Search PBGC’s database of insured plans.
• If your plan is insured and it ends without enough money to pay all benefits, PBGC steps in. PBGC will pay you the money you’re owed, up to legal limits.
• To learn more about PBGC-insured pensions, view these frequently asked questions.

Find an Unclaimed Pension

More than 38 million people in the U.S. haven’t claimed pension benefits they have earned. Find out if you, or someone you know, is owed a pension.

Federal Employee Retirement Planning and Management

If you are a federal employee planning to retire or a federal retiree looking for information about your benefits, the U.S. Office of Personnel Management (OPM)’s Retirement page can help you:

• Research and learn about retirement options.
• Manage your benefits online.
• Find options for signing up for direct deposit. If you receive paper checks now, you’ll soon be required to switch to direct deposit or Direct Express debit card.
• Find answers to frequently asked questions about retirement.

If you are the survivor of a deceased federal employee or federal retiree, you may be eligible for death and survivor benefits. Visit the OPM website to report the death and apply for death benefits.

Thrift Savings Plan

In addition to the defined or basic benefits provided by your Civil Service Retirement System (CSRS) or Federal Employee Retirement System (FERS) plan, if you are a current federal employee, you can boost your retirement savings by participating in the Thrift Savings Plan (TSP). The TSP offers the same types of savings and tax benefits as a 401(k) plan.

Credit for Military Service

Military service does not automatically count toward civil service retirement.

• To receive credit for military service performed after 1956, you must pay a deposit.
• If you are a military retiree, you generally cannot receive military service credit towards your civilian retirement unless you waive your military retired pay.

Pension Taxes

The Internal Revenue Service (IRS) offers an online tool and an online publication to help you determine whether or not your pension or annuity payment is taxable.

Contact OPM’s Retirement Operations Center

For benefits information or help with a transaction, contact OPM’s Retirement Operations Center.

State and Local Government Employees

If you are a state or local government employee and have questions about your pension plan, contact your agency’s personnel department. You can also contact the Employee Benefits Security Administration (EBSA) for help.

As you approach retirement, there are many things to think about. Experts advise that you will need about 80 percent of your pre-retirement income to continue your current quality of life. The exact amount depends on your individual needs. Some important factors to consider include:

• At what age do you plan to retire?
• Can you participate in an employer’s retirement savings plan, such as a 401(k) plan, or a traditional pension plan?
• Will your spouse or partner retire when you do?
• Where do you plan to live when you retire? Will you downsize, rent, or own your home?
• Do you expect to work part-time?
• Will you have the same medical insurance you had while working? Will your coverage change?
• Do you want to travel or pursue a new hobby that might be costly?

Tools to Help You Prepare for Retirement

To help you plan for retirement:

• Find practical tips for building retirement savings in the Top 10 Ways to Prepare for Retirement(PDF, Download Adobe Reader).
• Use a retirement calculator to find out the best age to claim your Social Security benefits.
• myRA, the U.S. Department of Treasury’s retirement savings program, ends in September 2018. Contact myRA by August 17, 2018 if you want the program to issue a check or transfer your balance to a new Roth IRA. Contact myRA by August 31, 2018 if you would like your balance transferred to a savings or checking account. Visit myRA.gov  to find out about all the deadlines that affect your account.
• Find out the trade-offs between taking your pension in a monthly payment or in a lump sum(PDF, Download Adobe Reader).
• Social Security pays benefits that are on average equal to about 40 percent of your pre-retirement earnings. You may be able to estimate your benefits.
• Learn how you can boost your retirement savings at Investor.gov.
• If you have a financial advisor, talk to him or her about your plans.