unexpected early retirement and Social Security

Abby1930February 22, 2004

I work for a large telecommunications company, one of the former Baby Bell's, and there is a possibility that our part of the company is going to be sold off. I am retirement eligible so I will probably retire in order to keep the benefits, pension and otherwise, that I have currently and will not have with the new company . I am too young (52) and with too many bills not to work, so I expect to pick up some other work to tide me over until I am 62, the age I originally planned on retiring at. This other job, whatever it will be, will undoubtedly pay far less than what I currently make with my baby bell. So my question is this..how is this going to affect my social security? My most recent paychecks prior to age 62 will probably be a good deal less ($10-20,000.00) then I make now. So will my 28+ years at baby bell be worthless as far as social security? Will it make a big difference? Just trying to figure out a whole lot of things here when I thought I had some job security. Hah!



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My husband is in the same situation. If I read information correctly- I think it either averages your income or takes the average of the highest ten years- I know they don't just take your last 10 years with it being the lowest.I hope somebody smarter than me posts.

    Bookmark   February 22, 2004 at 5:35PM
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In some pension systems, your contribution toward your pension is a percentage of your annual income and your pension at retirement relates to the amount that all of those years' contributions totalled out to, plus the amount of growth that all of those invested dollars produced throughout the period.

I hope that you can find some source of income which will be such that you can continue to enjoy your new home.

Lay-offs have become an increasingly common problem in the economy these days, where many companies feel that employees are as disposable as the machines that they use. Should we call such an approach "Kleenex staffing"?

They like loyalty on the part of staff - but if it isn't a two-way street, that rather traditional loyalty situation will be eroded.

In fact - it is, these days. Few employees feel as loyal to their employer as was true a generation ago.

Telecoms have certainly been volatile in recent years - and increasingly so?

While talking to my recently laid-off daughter (who had for several years been a counsellor to people being laid-off), she said that she'd like to have two or even three streams of income - so that she wouldn't be up the creek without a paddle if she suffered lay-off, having depended totally on one income.

She's a rather independent-minded person.

Who was able to carry on her recent work wherever she happened to be - all that she needed was a higher-grade connection to the internet. She used so much bandwidth that one couldn't call her and have the call go through while she was using the line for corporate-related internet work, as one can do with most internet users using high speed connection.

Good wishes to you as you work through your situation in the days ahead.

joyful guy

P.S. to others: If you should find yourself in this situation (say, next week?) - wouldn't it ease your concerns a great deal if you knew that you had enough assets rather easily available to enable you to survive without too much upset should you, having suffered the trauma of lay-off, find yourself unable to find other work for half of or even a whole year?

Personal financial advisors for many years have been recommending 3 - 6 mos. emergency fund to enable minimum survival. Such a plan is much more necessary in the employment climate, these days.

Don't you think?

I remember a song that was popular when I was young, ...

"Wishing, will make it so,
just keep on wishing,
and care will go."

"Dreamers tell us dreams come true,
it's no mistake
and wishes are the dreams we dream
while we're awake".


Visioning has its place. So do dreams - and wishes.

The problem is that quite a number of us allow the dreams and wishes to take the place of reality, rather than encouraging and impelling us to implement them - to change them from a figment of our imagination into a real part of our lives.

Dream the dream - then make it work. ...

    Bookmark   February 23, 2004 at 5:05AM
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Yes, it will effect your social security. The 10 year thing I think is a myth. They take your whole years. I worked for years and never made much money until the last 15 years. My ss was very low- $600. Now it is $900.
Not a lot of money. Fortunately my husband will be working and I get a small pension from the state. I also have health Insurance through my last employer (county), However it is very expensive ($600) but I will pay gladly since it pays for itself in perscriptions alone. I would be in real trouble if I had to rely on medicare.

    Bookmark   February 23, 2005 at 11:27PM
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Of course, it depends on whether Social Security is changed significantly between now and when you are eligible, however, at the present time, Social Security benefits are calculated based on your 35 years of highest INDEXED earnings. Earnings are indexed using a formula which considers the average wages for the year being indexed and the average for the second year before you attain age 62.

So yes, unless the law is greatly changed, your earnings for your current employer will make a difference.

    Bookmark   February 24, 2005 at 2:03PM
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Write your senators and congressmen to express opposition to any social security "reform" that reduces your future benefits. Right now, the plan that the president has proposed will reduce the benefits of everyone under 55, so you are right in the cross hairs. Pay attention; you can't afford to neglect this.

    Bookmark   February 25, 2005 at 5:46PM
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You can request a report from SSA giving you a recap of your past earnings and SS contributions. I believe it will also tell you what your monthly check would be if you retire at 62. 10 years ago, they did not count either the first two or the last two years.

    Bookmark   February 26, 2005 at 7:03PM
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