Great question. Just like installing a ceiling fan, it’s complicated.
Generally speaking, most of our Firefighters and Police are public employees. They’re employed by a municipality. Might be a city, township, county, state or village. Not all the time, obviously, but a majority of the time this is the case. (Hate to be so general here, but I kind of have to). Due to the very nature of their employment, many times said Firefighters and/or Cops are not covered under Social Security that, say, a Proctor & Gamble employee may be. Does that mean Firefighters and Cops don’t get ANY Social Security? Not necessarily. Does that mean Firefighters and Cops don’t get ANY sort of retirement benefits at all then? Certainly not.
Teachers (here in Illinois, for example) generally are not going to be covered under Social Security. They are covered under the TRS (Teacher’s Retirement System). It’s a massive pension fund for state and local public employees of the great state of Illinois (I say with some jest). Therefore, they will probably not get much, if any, in terms of Social Security benefits upon retirement. There’s this thing called The Windfall Elimination Provision (WEP) that states the following:
- If you work for a federal, state, or local government agency, a nonprofit organization or in another country, you may be eligible for a pension based on earnings not covered by Social Security. A pension based on earnings not covered by Social Security can affect the amount of your Social Security benefit. We do not know whether you are eligible for such a pension, so the benefit estimates you have received may not have been adjusted for such a possibility.
Okay, so what’s that mean? For all intents and purposes, if you’re a Firefighter, and if you are slated to get retirement benefits from a pension, you will probably get little to nothing in terms of Social Security benefits upon your retirement. Now, just like a twin sized comforter on a king-sized bed, this doesn’t cover everyone.
That doesn’t mean that they CANNOT get any Social Security though. Keep that in mind as we continue.
Of course, many factors will be in play as to whether a teacher gets Social Security benefits at retirement or not. Questions such as: Is the teacher married? How long were they married? Is said teacher widowed? Does the teacher work a second job during summers? If so, how long did they work at that job? (very important information to know for a Financial Planner to know)
Alright, enough about teachers.
I bring that all that up to in an attempt to better illustrate how public employees are covered in terms of retirement benefits. I feel like a lot of people understand how teachers are covered in terms of retirement benefits. That’s why I used them as an example here. I could certainly be wrong. It’s happened before.
Either way, teachers (in Illinois, at least) are in a very similar boat with Firefighters and Cops in regard to retirement benefits.
Customarily, Firefighters and Cops are public employees. That means they will generally not receive any Social Security benefits (Marital status may make things different). Because of their employment status they will most likely get retirement benefits from a state or local pension instead of Social Security.
Now, can a Firefighter or Cop get Social Security upon retirement? Possibly. I’ll give you a few examples where a Cop/Firefighter may get some Social Security retirement benefits:
- If the Firefighter or Cop is covered under Section 218 Agreement they might get Social Security benefits when he/she retires.
- If the Firefighter or Cop worked a second job and had ‘earned income’ they may get some (and I stress ‘some’) Social Security benefits during their retirement.
I don’t want to get into the weeds too much with the Section 218 Agreement and ‘earned income’ because there’s a lot to it, Plus, it’s late and I’m sort of exhausted from this head cold I’ve had for like 3 days now.
If you are curious about your personal situation feel free to reach out to me. There’s contact page on the home page of this blog (www.theanxiousadvisor.com). I’d be happy to talk with you about your personal Social Security or pension, or retirement concerns. Or any other financial concerns, for that matter.
All information gathered for this article is deemed to be from reliable sources. Please do not take this article as advice regarding Social Security, pension benefits or any other sort of retirement planning for firefighters advice. Please consult a knowledgeable professional for advice about your specific retirement, Social Security or pension retirement benefits questions or concerns.