Your age to receive full Social Security benefits and the early retirement reduction from Social Security – SS Benefits
You can retire early from Honeywell or Alliant Tech Systems if you are at least 55 years of age and have 15 years seniority. You do not need 85 points to retire early. 85 points only reduces the early retirement penalty. Each month of early retirement reduces the pension monthly payout by .3%.
EARLY RETIREMENT PENALTY
With 85 Points
Without 85 Points
Income Leveling is a feature of the pension plan that allows you to retire early at a set amount of dollars per month.
Income Leveling has 2 parts:
1.) For Honeywell it is your monthly pension payout = (years of service x $53.50) – early retirement penalty – joint & survivor reduction. (Alliant employees should use $47.5).
2.) The primary social security payout at full retirement age (either 65 or 66) – early retirement social security penalty. Honeywell figures the social security penalty = .4% reduction x the # of months you retire early.
PENSION CALCULATION EXAMPLES
When someone sets up an income leveling schedule to age 65 or 66 and then retires early at age 62 he/she can Double Dip. When you retire at 62 your social security is actuarially reduced by 6.6% per year to age 65 or 66 (whichever is applicable). But because the income leveling is set at the higher level you get the additional dollars until you turn 65 or 66. At 65 or 66 your pension reduction is set but your social security will be reduced depending on what age you began collecting social security. The decision you make is whether the additional dollars you receive from 62 to 65 by double dipping offset the reduced social security dollars after age 65 or 66. Other income, investments, and life expectancy are factors in the decision.
A Cobra policy is available from BCBS for up to 18 months.