Your Pension and Social Security Benefits

The amount of your Social Security benefits are mainly determined by how long you've worked and paid into the Social Security system. Despite a popular misconception, receiving a pension does not automatically reduce your Social Security benefits.

I am receiving, or will be receiving, a pension, does this affect how much I can expect to receive from Social Security?

Generally, no. Both pensions and Social Security require you to "pay in" in order to receive the benefit of these retirement systems. If you've been paying into Social Security during your working life, then your pension won't necessarily reduce your Social Security income.

What can sometimes happen, however, is that a person was not paying into Social Security for a period of time, but was paying into a pension, which can cause confusion. If you did not pay into Social Security because you worked for the U.S. civil service, some state and local governments, or for a foreign employer who wasn't required to pay in to Social Security, then you will see a reduction in your Social Security benefits. Your reduction in benefits is based on the time period you didn't pay, however, not on your pension.

If you did not pay in to Social Security for a while and want to calculate the reduction in your benefits, visit www.socialsecurity.gov and search for Publication No. 05-10045 which will explain how to calculate a reduction.