- Does it Matter If You Earn Money After You Sign Up for Social Security Retirement Benefits?
- Can You Collect Partial Unemloyment & Social Security Benefits?
- How to Collect Social Security Before Retirement Age
- Can I Collect a Share of My Spouse's Social Security Retirement Benefits?
- Disability Vs. Social Security Benefits at Retirement
- How Does Civil Service Retirement Affect Social Security Benefits?
While the Social Security Administration does not count unemployment insurance benefits as earnings, your unemployment benefit may be reduced if you receive benefits from Social Security at the same time. Social Security has no problem with you receiving income from both sources. However, the guidelines for reducing unemployment benefits vary by state. The state in which you reside decides if receiving additional income will reduce your weekly or biweekly unemployment payments.
Since many individuals who receive monthly Social Security retirement benefits have to go back to work after retiring, losing your job means managing on less income. Unemployment compensation benefits help to fill the gap. While many older workers qualify to collect both federal and state benefits, whether you are eligible to receive unemployment benefits depends on the laws of your state. If you qualify for benefits from both Social Security and your state unemployment office, you need to let each agency know how much income you receive from the other.
Although individual states can set their own terms regarding a person’s eligibility for collecting unemployment insurance benefits, most states allow you to collect full Social Security and unemployment benefits simultaneously. Only a few states still have an offset rule in place, which reduces unemployment compensation by 50 percent of your Social Security benefits. Before most states repealed the offset law, some required a 100 percent offset, which meant that you received no unemployment benefits if you received income from Social Security. In recent years, the laws in most states have changed allowing retired workers to receive the full retirement and full unemployment insurance benefits to which they are entitled.
According to Social Security Administration rules, you may continue to work while you receive Social Security retirement benefits. If you take early retirement, Social Security will deduct $1 from your monthly benefit payment for every $2 you earn above the annual limit, which was $14,640 for the year 2012. Earning below that amount will not cause you to lose any of your Social Security retirement benefits. This policy applies only if you are under your full retirement age. Once you reach your full retirement age, there is no limit on how much you can earn. Your earnings will no longer reduce your benefit amount. Social Security determines your full retirement age by your year of birth.
When older workers get laid off near retirement age, it can cause confusion about whether they will qualify for unemployment benefits. In cases where you reach full retirement age while collecting unemployment benefits, you can apply for your Social Security retirement benefits as well. On the other hand, some workers apply for their Social Security benefits early because they’ve been laid off and continue to find themselves jobless because of their age. In the meantime, most state policies allow them to continue to collect state unemployment benefits until they run out.
- pensive older woman in color image by dav820 from Fotolia.com