Sun Lakes resident Richard Beveridge received a rude awakening recently when he lost his job and applied for unemployment insurance. The state is penalizing him because he is receiving a Social Security check.
The former security guard, approaching 80, was laid off on Dec. 12 after working part time for Pinkerton Security Services for 29 months. He relied on the extra income along with Social Security to help cover his and his wife’s living expenses.
Upon applying for unemployment insurance, Beveridge was told he was eligible to receive $102 per week. The maximum weekly benefit in Arizona is $205, the lowest in the nation.
Usually people who are working part time aren’t eligible for unemployment insurance, but there are some exceptions, said Marla Lazere, executive staff assistant for the Arizona Department of Economic Security’s division of employment and rehabilitation services.
“You have to be earning a certain amount of income to receive unemployment insurance,” she said.
Also, you have to agree to look for full-time employment, Lazere said.
Beveridge said his job paid about $600 a month, and because of that, he and his wife didn’t have to worry about skimping to make ends meet.
When filing for unemployment, Beveridge found out his Social Security would sharply decrease his weekly benefit check. “There was a catch as I was told to send them my Social Security benefits, which I did,” he said. “It took the (Department of Economic Security) over a month to let me know that my weekly allowance was being reduced to $10 per week.”
The DES took Beveridge’s gross Social Security benefit, including Medicare, and divided it by 4.3333, then multiplied that amount by 45 percent, which left $92. That was subtracted from $102, the weekly amount in unemployment insurance Beveridge originally was eligible for, leaving only $10.
“It’s ridiculous, why do they have to mess with Social Security?” Beveridge said. “I was shocked. I know that most people, the senior citizens who want to work, don’t even know that.”
A federal law gave states the right to decide whether Social Security is counted against unemployment insurance, Lazere said.
The Arizona Legislature decided to factor in Social Security when determining seniors’ unemployment insurance, she said.
“The federal law is very vague,” she said. “It just tells states to consider it so they could count none or all. Arizona is pretty much in the middle where we deduct 45 percent. We don’t count all of it and we don’t count none of it.”
Of the 189,503 unemployment insurance claims filed in December in Arizona, about 1,200 were made by people who receive Social Security, Lazere said.
The number of seniors finding themselves in Beveridge’s position is going to increase in the coming years because more will be forced to work through retirement, said William Arnold, director of the gerontology program at Arizona State University in Tempe.
“Particularly as we look to the baby boomer population, the oldest now is about 55, those folks haven’t been saving,” he said. “So not only are they going to have to put off their retirement and keep working, we have already put in place for some of them that they’re not going to be able to get their Social Security too much later.”
If they start collecting Social Security at 67 or 68, for many it probably won’t be enough to live on, so they will be forced to continue working at least part time, Arnold said. Then, if they lose that job, unemployment insurance won’t help in covering that lost income.
“I think it’s only going to get worse because of the lack of savings and escalating costs, particularly in things like health care,” he said.
In the meantime, Beveridge said he has contacted his legislators, who told him the issue can’t be addressed this year. He also said it’s almost impossible to find work when you’re approaching 80.
“We’re skimping downward,” he said. “My wife has a lower retirement and she gets part of my Social Security and that’s it. We just barely skim by and we’ve got to watch what we spend.”