Retirement Benefits

For those drawing Social Security benefits, the earnings test applying to beneficiaries aged 62 through "full retirement age," currently 66, rises from $14,640 to $15,120 this year. Those beneficiaries lose $1 in Social Security benefits for every $2 in earnings through employment or self-employment above the limit.


A separate earnings test applies only to earnings for months in the year an individual reaches full retirement age but prior to the individual attaining that age. One dollar in benefits will be withheld for every $3 in earnings above $40,080, up from $37,680. There is no limit on earnings beginning the month an individual attains full retirement age.

For purposes of determining the benefit offset under the windfall elimination provision—which can reduce Social Security benefits of CSRS retirees who worked long enough in each system to qualify for a benefit from each—the annual "substantial earnings" minimum is up from $20,474 to $21,075.

Several costs under the Medicare program also have risen for 2013. The premium paid by the large majority of enrollees in Part B of the program (generally covering physicians’ services) is $104.90. Higher-income retirees pay higher premiums. The Part B annual deductible is $147. The Part A (inpatient hospital care) deductible is $1,184, and the daily copay for days 61 through 90 in a hospital increased to $296, and for days beyond the 90th day to $592. Daily copays for stays in a skilled nursing facility are $148, for eligible periods.

The average monthly premium for Part D (prescription drug coverage) remains about $30; however, there is wide variation among those plans. In most cases federal retirees who continue their FEHB insurance don’t take Part D since FEHB plans already provide prescription drug coverage that is generally considered superior to what Part D provides.