Ask June > , , , , , > VA, retirement pay impact on Social Security

VA, retirement pay impact on Social Security

July 11, 2012 • June Walbert

Q: I will turn 62 in Jan 2013 and will retire from the Army Reserves and draw approx­i­mately $3900 a month before sur­vivor ben­e­fit reduc­tion and taxes. My social secu­rity ben­e­fit is around $1050 a month at 62. I may also get VA dis­abil­ity of let’s say $1000 a month. Will my social secu­rity ben­e­fit be reduced because of my reserve pay and if that ends up being the case, how about the dis­abil­ity pay from VA? If so, or if not, how much can I make with­out penalty in civil­ian wages with­out hurt­ing my small $1050 a month from social secu­rity. Thanks.

–Steve, Dav­en­port, Iowa

A: Con­grat­u­la­tions on your pend­ing retire­ment and thanks for your years of ser­vice. You’ve got a bunch of ques­tions. First off, nei­ther your mil­i­tary retire­ment nor your poten­tial VA com­pen­sa­tion will affect your Social Secu­rity ben­e­fit. How­ever, if you do plan on tak­ing Social Secu­rity early, at age 62, your earned income from “civil­ian wages” could reduce your Social Secu­rity ben­e­fits. In 2012, any earned income (this does not include your mil­i­tary retire­ment or VA com­pen­sa­tion), above $14,640 will reduce your Social Secu­rity ben­e­fits $1 for every $2 over the thresh­old. Here’s a link to info on that topic at the SSA web­site.

How­ever, no mat­ter when you begin ben­e­fits, it’s fairly likely given the amount of your mil­i­tary retire­ment that a por­tion of your Social Secu­rity will have to be included as income. Good luck as you embark on the next stage of your life!

Share |

4 responses to “VA, retirement pay impact on Social Security”

  1. otosine
    July 21, 2012 at 3:52 pm |

    I’m in tech school right now as a crew chief for the air force. One of the biggest parts of this arti­cle that stuck out to me was stay­ing involved as you go through the enlist­ment process and it’s com­pletely true. While i was get­ting ready to ship off to basic train­ing I would go above and beyond the norm to help out my recruiter, I showed up for PT ses­sions before I ever went to MEPS and made it a point to go every week. Soon i started lead­ing the PT ses­sions and even­tu­ally was made DEP com­man­der by my recruiter.I feel that it started the trend that’s been fol­low­ing me ever since. When i finally got to basic train­ing in Decem­ber of this last year my MTI made me an ele­ment leader and now I’m an air­man leader here at tech school. The point is that even if your still not sure about going into the mil­i­tary but have talked to a recruiter you should try to get inv­oled with some of the extra activ­i­ties your recruiter does because you can’t know if it’s right for you until you start to meet the peo­ple in it. This could even be your oppor­tu­nity to become a great leader or at least shape you life into the best that it can be. I’m only 9 weeks out of basic train­ing so every­thing that hap­pened there is still fresh in my head and I’m happy to help any­one that has ques­tions about it no mat­ter what branch of ser­vice i can tell you hon­estly what your get­ting into. Email me at ayo.olawumi@yahoo.com with any ques­tions. The mil­i­tary has done great things for me and i want to share the expe­ri­ence with any­one that wants to know

  2. mistphentwebto
    August 3, 2012 at 1:12 pm |

    hell yeah!!! )

  3. Mostley
    August 25, 2012 at 8:36 am |

    thumbs UP!

  4. Orlando
    August 31, 2012 at 6:45 am |

    Cap­ti­vat­ing. I’ve been look­ing for some­thing like this for a while now.

USAA or its affiliates do not provide tax advice. Taxpayers should seek advice based upon their own particular circumstances from an independent tax advisor. The information is provided for informational purposes only and is not intended to substitute for obtaining professional financial advice. Please thoroughly research and seek professional representation before acting on any information you may have found in this article. This article is in no way attempts to provide advice that relates all personal circumstances.

Examples given are hypothetical illustrations and not an indication of the benefits or features of any USAA product. You should seek policies and advice based upon your own particular circumstances. Sample loans are for illustration purposes only and are not a rate quote, pre-approval, or commitment to lend.

June Walbert is a CERTIFIED FINANCIAL PLANNER TM practitioner with USAA Financial Planning Services, one of the USAA family of companies. Certified Financial Planner Board of Standards, Inc. owns the certification marks CFP® and Certified Financial Planner TM in the United States, which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

USAA Financial Planning Services® refers financial planning services and financial advice provided by USAA Financial Planning Services Insurance Agency, Inc. USAA Financial Planning Services Insurance Agency, Inc. (known as USAA Financial Insurance Company in California, Lic. #0E36312), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer. (known as USAA Financial Insurance Agency in California), a registered investment adviser and insurance agency and its wholly owned subsidiary, USAA Financial Advisors, Inc., a registered broker dealer.

USAA means United Services Automobile Association and its affiliates. Investments provided by USAA Investment Management Company and USAA Financial Advisors Inc., both registered broker dealers. Banking products provided by USAA Federal Savings Bank. Credit cards provided by USAA Savings Bank. Both Banks Member FDIC.