US Military Money Item

[Owen` 2]

US military vets.

 

Heads up, in case you didn't know.

 

When you reach Soc. Sec retirement age (or if you already have), if you notify Soc. Sec. that you have military years of service it will increase your pension payout.

 

The form they send you each year showing you how much money you contributed to the system does NOT reflect this additional total. The ssa.gov website describes the formula, but in general it is $1200 more per year of military service. For a nominal 5 yrs of military, this adds maybe $60/month to your eventual pension.

 

It's a nice, unexpected, chunk.

[Florida Guy 0]

Owen, I'm not exactly sure what you mean.

 

I get the form every year which says, "Your Social Security Statement" on the front. In fact I just received one recently.

 

Inside in the "Earnings Record" it shows all the years I've worked (as well as the years I was in the military) and what I earned during all of those those years. Is this the area you're talking about?

 

Confused.

 

After re-reading your post I might understand ... are you saying that they add approx. $1200 to the total you show as income during those military years? So if my "earnings record" shows $XXXX the actual total will be $XXXX + $1200 ??

[Florida Guy 0]

Owen ... thanks man ... I just found it on the ssa.gov site. The way it reads you're exactly right. I guess I'll be on the phone for the next couple hours as I think there are quite a few buddys of mine that this will help out ... including myself.

 

Again, thanks loads ... every little bit helps!

[Owen` 2]

Owen, I'm not exactly sure what you mean.

 

I get the form every year which says, "Your Social Security Statement" on the front. In fact I just received one recently.

 

Inside in the "Earnings Record" it shows all the years I've worked (as well as the years I was in the military) and what I earned during all of those those years. Is this the area you're talking about?

 

Yes.

 

After re-reading your post I might understand ... are you saying that they add approx. $1200 to the total you show as income during those military years? So if my "earnings record" shows $XXXX the actual total will be $XXXX + $1200 ??

 

Yes.

 

Owen ... thanks man ... I just found it on the ssa.gov site. The way it reads you're exactly right. I guess I'll be on the phone for the next couple hours as I think there are quite a few buddys of mine that this will help out ... including myself.

 

Again, thanks loads ... every little bit helps!

 

[picoman 1]

Nice !

 

...now all I have to do is collect that Social Security... will it be there in 23 more years ?

 

According to your figures, that's an extra $96/mo. for me... in 23 years that may pay for 1/2 a BF...

 

Thanks, Owen.

 

[Florida Guy 0]

Picoman ... I believe Social Security has a COLA and compensates for inflation ... IF as you say, it's still there when you get there. I have 7 more years myself and still sweat it.

 

Here's the link by the way for anyone else who stumbles onto this thread.

 

Social Security

[Owen` 2]

According to your figures, that's an extra $96/mo. for me... in 23 years that may pay for 1/2 a BF...

 

The Florida Guy is right. Soc. Sec. is inflation adjusted. That's $96 2006-dollars. Whatever a 2006 dollar is worth in 23 yrs, multiply it by 96 and that's what they will send you additional each month. Meaning . . . a 1983 dollar is probably worth something like $2 in today's money, so maybe your $96 number will become something like $192 in 23 yrs. That's about 7 barfines.

 

If it's there. 23 is a lot of years for it to stay safe, but that particular pension will be the last one touched because there will be so many voters affected. Your odds are good you'll see some portion of it, if not all.

Edited September 26, 2006 by Owen`

[Rex7777 0]

Social Security and other US government pensions supposedly compensate for "inflation." The pension is adjusted each year to reflect the yearly increase in the CPI. However, in the early 1990s, they started tinkering around with how the CPI is measured. They had to find some way to cut the cost of the Social Security and pensions they had promised people. So now the CPI doesn't really reflect the actual inflation rate. Many people realize this, many do not. Somehow, the the government got away with it. So, if you're counting on Social Security or a government pension, you had better hope the real inflation rate slows down sometime soon, otherwise, you may be really hurting in the long run.

 

Rex

[Owen` 2]

There is considerable debate about the accuracy of the inflation index. It is not intentionally inaccurate. The problem is that a few items are holding the overall index down, and mostly they have to do with technology.

 

The price of X amount of computing power costs a fraction of what it did 10 years ago and the CPI properly tries to measure this. The same thing happens in car features. Can you imagine what you would have paid for a GPS in your car 10 years ago? The price of a DVD player or a plasma TV screen has just collapsed in 10 years, and this has to factor into the CPI as a proportion of total US spending. Technology has a huge effect on this.

 

So, the result is we get quoted 2% and 3% inflation numbers while medical care is booming upwards at 7% per year. Or gasoline is booming upwards. But right now we have housing heading down, technology heading down, and some foods are heading down. Average them all together and you get 2-3%.

 

We all got our own inflation rate, but the corrections being applied to the SS number are not outright bad. They are trying to measure things properly. If you don't buy a GPS in your car, you don't see it. If you still are using VHS tapes, you don't see it.

[picoman 1]

Good point, Owen, I never thought of it...

 

See you boys later, gotta check that Lotto ticket...

 

[Krowdon 0]

Well I'm not old enough to collect SS yet, but I'll be ready when I am. I've got 21.5 years of military service, so that might help the equation a little! Thanks!!

[short 215]

I think colas should be based on the cost of hotel rooms, airline ticket prices, beer, barfines, ST,and LT rates.

[Owen` 2]

I think colas should be based on the cost of hotel rooms, airline ticket prices, beer, barfines, ST,and LT rates.

 

Write your Congressman and ask.

 

Or watch TV.

 

Both are a waste of time.

[guido13 0]

US military vets.

 

Heads up, in case you didn't know.

 

When you reach Soc. Sec retirement age (or if you already have), if you notify Soc. Sec. that you have military years of service it will increase your pension payout.

 

The form they send you each year showing you how much money you contributed to the system does NOT reflect this additional total. The ssa.gov website describes the formula, but in general it is $1200 more per year of military service. For a nominal 5 yrs of military, this adds maybe $60/month to your eventual pension.

 

It's a nice, unexpected, chunk.

 

Interesting. Do you know if this applies if you are receiving military retirement pay?

 

Guido

[Owen` 2]

SS has a reduction in benefits, as I recall, if the recipient is getting any other form of federal pension. Or it could be that other pension that is reduced.

 

But in the text that outlines this little bump in SS benefit for military service, there is no mention of anything else. The general answer to your specific question would seem to be no. There are other effects on military pension, but this isn't one of them.

 

The idea is that while military some of your pay was housing allowance and food allowance and no SS tax was extracted from that. At the time you were happy about that, but retirees now wish otherwise. At some point some Congress critter friendly to the military slipped this into a bill and tossed a few dollars per month to veterans.

[Florida Guy 0]

The idea is that while military some of your pay was housing allowance and food allowance and no SS tax was extracted from that. At the time you were happy about that, but retirees now wish otherwise. At some point some Congress critter friendly to the military slipped this into a bill and tossed a few dollars per month to veterans.

 

Are you sure about that Owen? Personally I have no clue myself, but that reason may not add up. As an example, I lived in Thailand for three years while in the military but lived in a local village. The military paid me an "off-post housing" allowance as well as "separate rats" (separate rations ... food allowance). I didn't have an assigned room in the barracks and if I ate on a military installation I had to pay for the meal. But, you may be correct as I honestly don't remember whether or not they taxed those allowances.

 

When you brought this all to light (and I thank you) I just assumed it was some compensation for the low pay we receieved in the military compared to the going rate in civilian life. Again, that was total speculation on my part when I tried to use common sense as to why they were offering this.

[Owen` 2]

As an example, I lived in Thailand for three years while in the military but lived in a local village. The military paid me an "off-post housing" allowance as well as "separate rats" (separate rations ... food allowance). I didn't have an assigned room in the barracks and if I ate on a military installation I had to pay for the meal. But, you may be correct as I honestly don't remember whether or not they taxed those allowances.

 

Pretty sure I got this right. Housing and subsistence allowance were not taxed. Still aren't. The theory is you may sometimes be forced to live on base and eat on base, if that base is a battlefield. The rule just tosses some SS benefit to folks for being willing to endure that. This is from about.com:

 

 

"Below are the rates of tax-free housing allowance (Basic Allowance for Housing, or BAH) that are provided to commissioned officers (without dependents) who are authorized to reside off base at government expense."

 

 

 

It's not huge, but it's a nice cushion for some bad thing that might befall you, or maybe even a minor luxury to which you might want to treat yourself someday. Anyway, a good thing.

[travlling 0]

I think colas should be based on the cost of hotel rooms, airline ticket prices, beer, barfines, ST,and LT rates.

 

You forgot about Baht buses!

[Bobshere 7]

This has to a new provision of the tax code. Must have been this year.

I will certainly look into this.

Thanks for the information. I'll get my SSA girl working on this tomorrow.

Thanks

BoB

[Owen` 2]

Not new at all, Bob. Actually, it caught attention because the program shut down in 2001 after being in place for 30+ years. Military years of service after 2001 don't get this treatment.

 

This is going to translate into a few hundred dollars per year, inflation adjusted. Not thousands. No one will get rich on this, but it will be a nice addendum for guys that want to splurge once in a while on something extra.

[Bobshere 7]

Owen,

You are correct. This kicked in middle Jan 2002. From what I've read it is a supplemental form that has to be filed from you requesting that the quarters be added to your entitlement. Your entitlement then is re figured with the new amounts. I am wondering what will happen if these do not fall within the last 35 years that your benefits are calculated. This does noteffect me for my time is within the 35 year window. Take for example a person who served WWII, like my Dad. He is 85 and has been getting SS for since he was 65. His window is over. I will look into this further tomorrow.

Thanks for the infoprmation. I let you know what I find out.

Thanks

BoB

[midlifecrisis 4,030]

Picoman ... I believe Social Security has a COLA and compensates for inflation ... IF as you say, it's still there when you get there. I have 7 more years myself and still sweat it.

 

Here's the link by the way for anyone else who stumbles onto this thread.

 

Social Security

Fed Reserve chairman was quoted in the paper today that baby boomers would drain the economy if something wasn't done.

[Bobshere 7]

Owen,

I hope all is well with you. Some information about SSA and the military pay. It seems that in 1952 the SSA started at new system to calculate the benefits you are to receive. The SSA stated that it was in the best interest to the receiver (us) to start this new system. (We are the Government and we are here to help sort of thing) Anyone in the service after 1952 to include the present, the benefits would have been calculated under the new system. On the form there is a section that inquiries about military service time. Then I guess they use this information to update the amount.

One other thing I found out that had changed was if you stay married to the same wife over ten years she can make claim to a portion of your SSA benefits. I guess you could do the same to her SSA benefits if she made more than you did. I always thought the time limit was 20 years. Live and learn I guess. (I'm safe on this count)

I hope this helped a little. Thanks again for the original information.

Thanks

BoB

[Owen` 2]

Thanks, Bob. This looks like money we will probably collect someday, if we live long enough.