Uk pension and USA social security benefits what am I eligible for?
Oct 16th 2011, 7:59 pm
#16
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Joined: Apr 2011
Location: The Shire
Posts: 1,117
Re: Uk pension and USA social security benefits what am I eligible for?
How do they deal with fluctuations in £/$ exchange rate?
Current UK state pension is £442 pcm (about £101 per week).
This is currently about $730 pcm at £1=$1.65, but if the pound went to $2, it would be $882. So the UK state pension is a moving target ... do they simply calculate based on exchange rate at the beginning of each tax year?
Not that it's a problem for me, because by the time I retire they'll probably make US nonresidents ineligible for SS pension.
Current UK state pension is £442 pcm (about £101 per week).
This is currently about $730 pcm at £1=$1.65, but if the pound went to $2, it would be $882. So the UK state pension is a moving target ... do they simply calculate based on exchange rate at the beginning of each tax year?
Not that it's a problem for me, because by the time I retire they'll probably make US nonresidents ineligible for SS pension.
It's something to consider when applying for US SS, although most don't take it seriously until exchange rates start to vary. Applying for US SS, and being WEPed, is not a good thing when the exchange rate is $2/£1.
Your monthly check, if deposited into a foreign bank account, uses the exchange rate for the day of the monthly payment. If this is the case, you can never accurately predict your SS income.
Last edited by theOAP; Oct 16th 2011 at 8:21 pm. Reason: error / clarity
Oct 17th 2011, 12:50 pm
#17
Heading for Poppyland
Joined: Jul 2007
Location: North Norfolk and northern New York State
Posts: 14,540
Re: Uk pension and USA social security benefits what am I eligible for?
When WEPed, the Social Security Admin. will use the exchange rate for the day your claim is entered into the computer. That will determine the amount of your non-SS pension (like UK state pension). In turn, the resulting US SS benefit will be based on that amount for the rest of your life, and COLA increases in US SS will start with that benefit amont.
It's something to consider when applying for US SS, although most don't take it seriously until exchange rates start to vary. Applying for US SS, and being WEPed, is not a good thing when the exchange rate is $2/£1.
Your monthly check, if deposited into a foreign bank account, uses the exchange rate for the day of the monthly payment. If this is the case, you can never accurately predict your SS income.
It's something to consider when applying for US SS, although most don't take it seriously until exchange rates start to vary. Applying for US SS, and being WEPed, is not a good thing when the exchange rate is $2/£1.
Your monthly check, if deposited into a foreign bank account, uses the exchange rate for the day of the monthly payment. If this is the case, you can never accurately predict your SS income.
Oct 17th 2011, 4:55 pm
#18
BE Forum Addict
Joined: Apr 2011
Location: The Shire
Posts: 1,117
Re: Uk pension and USA social security benefits what am I eligible for?
[quote=robin1234;9679388] What?? That seems a bit of a blunt instrument. [quote]
That's how my US SS benefit was, and is, being calculated. I believe the statement is correct for non-SS foreign pensions you already receive when applying for US SS. (I should have made that clearer in the post.) Now you may understand why I've made comments in past threads about my dissatisfaction with WEP. And, why I hate floating exchange rates.
I don't know how entitlement at a later date is handled. (I received my UK State Pension before I applied for US SS.) They may ask, at the time of applying, about any future pensions you expect to receive.
But, be aware that you are required by law to inform the SSA of any changes in circumstance that may alter your benefit. I suspect (and this is my guess) that the UK pension will not be considered and the exchange rate will not be initiated until you actually notify SSA at the time (2015) you start receiving the UK pension.
When you apply, the paperwork is littered with the following warning:
"I know that anyone who makes or causes to be made a false statement or representation of material fact in an application or for use in determining a right payment under the U.S. Social Security Act commits a crime punishable under Federal law by fine, imprisonment, or both."
That's how my US SS benefit was, and is, being calculated. I believe the statement is correct for non-SS foreign pensions you already receive when applying for US SS. (I should have made that clearer in the post.) Now you may understand why I've made comments in past threads about my dissatisfaction with WEP. And, why I hate floating exchange rates.
But, be aware that you are required by law to inform the SSA of any changes in circumstance that may alter your benefit. I suspect (and this is my guess) that the UK pension will not be considered and the exchange rate will not be initiated until you actually notify SSA at the time (2015) you start receiving the UK pension.
When you apply, the paperwork is littered with the following warning:
"I know that anyone who makes or causes to be made a false statement or representation of material fact in an application or for use in determining a right payment under the U.S. Social Security Act commits a crime punishable under Federal law by fine, imprisonment, or both."
Last edited by theOAP; Oct 17th 2011 at 5:00 pm.
