2. Government pension

Another thing that will drastically cut down on your Social Security benefits is the government pensions. The Windfall Elimination Provision, which can reduce retirement or disability benefits for people who receive a pension from a job where they didn’t pay Social Security taxes and those who qualify for Social Security based on other work in which they did pay into the system, began to apply to about two million Social Security beneficiaries in 2021. This WEP usually “affects” people who were police officers, teachers, and retirees who started working before 1984, because these agencies aren’t covered by Social Security.

People who receive Social Security spousal or survivor benefits as well as a “non-covered” government pension are subject to a similar restriction known as the Government Pension Offset (GPO). A GPO benefit decrease of up to two-thirds of the pension can be applied. Keep in mind, however, that military retirement pay is not included in these two categories and will have no effect on your Social Security benefits.