The Foreign Service Journal, April 2003

APRIL 2003 • AFSA NEWS 9 Retiree Issues BY WARD THOMPSON, RETIREE LIAISON Q: How do I know I have not overlooked something affecting my Foreign Service retirement benefits? A: If you understand the basics regarding annuities, survivor annuities, Social Security, life insurance, health plans and Medicare, you probably either have enough information or know where to look for it. The information is available from the State Department Retirement Office and is covered in the Retirement Planning Seminar. However, the burden is on the employee/retiree tobe familiarwith the regulations governingben- efits. Relevant information should be retained and reviewed periodically to avoid surprises. Q: What kind of surprises? A: The most common surprises concern the following: ANNUITY SUPPLEMENT —Designed to provide Foreign Service Pension System (FSPS) annuitants the equivalent of aSocial Security benefit until age 62, when one becomes eligible for a minimum Social Security benefit, the supplement is not increasedby an annual COLA (cost of liv- ing adjustment) but is subject to the Social Security earnings cap. Some consider it unfair for the supplement not to extend until full Social Security eligibility (age 65 or higher), especially if they are involun- tarily retired. However, retirement plan- ning must take into account the fact that Congress intended the supplement only as a bridge to minimum Social Security eli- gibility. WINDFALL ELIMINATION PROVISION (WEP) —Congress also decided that indi- viduals receiving pensions from jobs not coveredby Social Security shouldhave any additional Social Securitybenefits reduced. The WEP applies to Foreign Service Retirement System (FSRDS) annuitants whoreachedage62after 1985andwerenot eligible for a federal annuityuntil after 1985 (those who were under 62 and still work- ing in1985butwhocouldhave retired then arenot affectedby theWEP). Manymem- bers who acquired Social Security eligibil- ity before or after the Foreign Service are now turning 62 and discovering that the WEP reduces their Social Security benefits by up to 55 percent. GOVERNMENT PENSIONOFFSET —This laweffectively eliminates anySocial Security spousal benefit formost post-1982FSRDS annuitants who did not switch to FSPS before 1988. (Note: theWEPandGPOdo not applywhenone’s annuity is a survivor benefit, only when an annuity was earned as an employee.) Q: Is my spouse due for any unpleasant benefit surprises if I should die first? A: There are twoareaswhere some members encounter problems that could have been prevented but that cannot be remedied after the fact: SURVIVORANNUITY —Provisionmustbe made at retirement or within one year (FSRDS) or two years (FSPS) following a marriage that occurs after retirement (and theannuitantmustnothavedeclinedtoelect asurvivorbenefitforaspouseatretirement). Survivor annuities for former spouses and secondspousesaresubjecttoadditionalrules, whose impact on retirement planning should be understood by all parties con- cerned. Anemployeeprovidingaminimum survivorbenefit(seebelow)maynotincrease it more than 18months after retirement. HEALTHBENEFITS —Asurviving spouse may continue receiving full federal employ- ee health benefits only if receiving at least a minimum ($1.00 per month) survivor benefit and if the deceased had been enrolled ina self-and-familyplanat the time of death. ▫ Q & A U ncertainty, unpredictability, com- plexity,turmoil,lackofresourcesand generallydifficultworkingconditions are themost common elements character- izing the current landscape facing foreign affairsNGOs as they seek to carry our their crucial missions for the public good. This was one of the key conclusions from a January NGO leadershipmeeting. Itwas in that context that some40 lead- ers of America’s NGO community came together at the Woodrow Wilson International Center for Scholars in Washington on Jan. 24 for discussion and reflection. Becausemany of our colleagues intheNGOcommunityfacethesameprob- lems as the UnitedNations and its special- ized agencies, representatives from the U.N. community also attended. This was a unique event sponsored by the Coalition for American Leadership Abroad, a group ofmorethan45NGOs. (COLEADishead- quartered at AFSA, and AFSA is a found- ing member of the organization.) The January meeting was in keeping with COLEAD’smandatetoprovideaforumfor the internationally-oriented NGO com- munity to share concerns and, where pos- sible, work together to seek common solu- tions. Oneof thebackgroundelements for this meetingwasthebroadrecognitionthatwhile foreignaffairsNGOshavea significantmis- sion, they are comparatively less influential in shaping the direction of policy and the environment in which we work than do many other sectors of our society. From the discussion, which included AFSA President John Naland, participants concludedthattheNGOcommunityisnow facingmore challenges to carrying out our missions thanwehave seen inrecentmem- ory. This is especiallydauntingconsidering that this community is accustomed to fac- ingwars, crisis andnatural andman-made catastrophes. It was agreed that there is a need to cooperate better and to make our COLEAD UPDATE NGO Summit on International Landscape BY HARRY C. BLANEY III, PRESIDENT OF THE COALITION FOR AMERICAN LEADERSHIP ABROAD