At 84 years old, Evelyn Paternostro spends her days working part-time as a cashier at Dollar Tree. For decades, she dedicated her life to education, serving as a teacher and principal in Louisiana. But despite years of her public service, she now struggles to make ends meet.
“People at the store ask me all the time, ‘Are you doing this for fun? Why aren’t you retired?'” she said. “Because I need to eat.”
After her husband died, Paternostro discovered she couldn’t collect his Social Security benefits due to a pair of federal policies called the Windfall Elimination Provision and the Government Pension Offset.
These provisions reduce or eliminate Social Security benefits for millions of Americans if they receive a public pension that doesn’t withhold Social Security tax. Retired teachers, firefighters, and other public servants are some of the most impacted.
“I was really blindsided,” she said. “I knew I was going to have a teacher’s retirement. I was going to be part of the Louisiana Teachers Retirement System. And I never really thought about my husband’s income and what that would mean to me.”
Who Is Affected?
Nearly 2.8 million individuals across the United States are impacted by WEP and GPO. Its effects extend to all employees of state, county, municipal, and special districts in 26 states. Teachers in 13 of those states, including specific districts in Kentucky and Georgia, also feel its impact.
In Massachusetts and certain districts in Rhode Island, not all municipal employees but only teachers are impacted.
The purpose of these two 1980s-era programs was “so that there was no way you could ‘double dip’ into both a federal pension and Social Security,” explains Jill Schlesinger, CBS News business analyst.
The Windfall Elimination Provision affects people who qualify for Social Security benefits through their jobs but also receive a pension from another job where they didn’t pay into Social Security.
It may decrease their Social Security payments by up to half the value of their pension.
For example, Michelle Cosgrove’s benefits will be cut nearly in half — reduced by $557 to $601.
Cosgrove spent the first half of her career as a paralegal, contributing to Social Security, before staying home to raise her children.
Later, she became a public school teacher in the San Francisco Bay Area, paying into CalSTRS, California’s educator pension fund. However, her plans for retirement took an unexpected turn when she discovered the intricacies of the pension system.
When she retired, Cosgrove’s reduced payments affected her ability to pay bills and cover expenses.
The other program, the Government Pension Offset, further impacted Cosgrove after her husband, Mike, passed away in 2022. Despite working in the private sector for decades and contributing to Social Security, his benefits were largely inaccessible to her due to the GPO.
Mike, a welding supervisor, was diagnosed with a rare cancer at 52 but continued working until his health worsened. He died at the age of 63.
If pension recipients are widows or widowers of someone who received Social Security benefits, that pension recipient may have reduced survivor benefits or may not receive benefits at all.
“If I’d have stayed home and done nothing, I’d have gotten all the money,” Cosgrove said. “Had I known this, I might not have gone into teaching. I’d have picked something different.”
