Retirement & Financial Planning Report

An inspector general audit at the Social Security Administration found errors in more than half of a sampling of beneficiaries whose benefits were affected by the earnings test.

That test reduces benefits for those who retire before the Social Security “full” retirement age—in 2020, 66, rising in 2021 to 66 and two months—and have earnings from employment or self-employment above an annual threshold—$18,240 rising to $18,960—until they reach that age. There is no reduction for earnings after reaching that age.


The earnings test is a common consideration for federal employees, many of whom continue to work, even if only on a part-time basis, after retiring from the federal government, where the average retirement age is about 62.

Auditors selected a sample of 100 of some 7,500 beneficiaries who, according to agency records, had their monthly benefit reduced under the earning test but whose benefits were not adjusted when they attained full retirement age. Of those 100, it found the SSA incorrectly adjusted benefits of 53, who on average had passed that age more than four years previously.

Of the 53, the IG determined that 38 were being underpaid and 15 were being overpaid.

The report said management agreed with its recommendations to ensure it generates and resolves alerts for beneficiaries whose benefit amounts should be adjusted.

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