This is a confusing issue for many people. So today we’re answering the top three frequently asked questions on whether or not Social Security retirement benefits play nicely with Social Security Disability Insurance (SSDI) benefits.
Frequently Asked Questions about SSDI and Retirement Benefits
1. Can I qualify for both SSDI and regular Social Security benefits if I become disabled after I retire?
Answer: No. Essentially, SSDI and retirement benefits are the same thing, so you cannot draw both after retiring. According to the Social Security Administration (SSA), SSDI benefits automatically change to regular Social Security payments upon reaching full retirement age. The law prevents anyone from receiving both retirement and disability benefits on the same earnings record.
Social Security’s full retirement age (FRA) depends on when you were born. For individuals born in 1937 or earlier, your FRA is 65. If you’re born in 1960 or later, the FRA gradually increases to 67.
2. Are there any exceptions to this rule?
Answer: Yes. However, only one exception exists, and it’s called the early retirement exception.
In most cases, if you decide to retire and start drawing benefits before your FRA, they’re significantly reduced. For example: If you draw retirement benefits at 62 (the earliest age you can apply) but your FRA is 65, the SSA typically reduces all future payments by 25%.
However, if you apply at age 62 for both SSDI and retirement benefits, you’ll receive your full benefit amount. No reductions are made for a non-disabled person.
3. My health isn’t great. Should I apply for SSDI and early retirement benefits at the same time when I turn 62?
Answer: Yes! If a disability forced you to retire early at 62, you may qualify for both SSDI and retirement benefits until you reach your FRA. However, you cannot apply for both until you turn 62. Getting approved for both is the only way to receive your full retirement benefit amount in monthly SSDI payments. Then once you reach your FRA, your disability payments automatically convert over to regular Social Security.
The SSA calculates most people’s retirement benefits based on highest earnings during their 35-year work histories. However, the SSA also takes into account the impact a disability has on an individual’s income history. As a result, if you still get disability benefits once you reach your FRA, your regular Social Security amount will not change. The amount isn’t based on your income history. Instead, the SSA bases it on formulas governing how much you qualified for in disability benefits.
You May Qualify for Legal Assistance
Approximately 8.8 million Americans receive SSDI benefits. And another 1.8 million dependents rely on the program to make ends meet. If you’re considering applying for SSDI, knowing when to apply as you approach retirement is often confusing. But luckily, you are not alone. Speak with an experienced disability attorney or advocate today to get confidential legal advice by phone.
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Laura Schaefer is the author of The Teashop Girls, The Secret Ingredient, and Littler Women: A Modern Retelling. She is also an active co-author or ghostwriter of several nonfiction books on personal and business development. Laura currently lives in Windermere, Florida with her husband and daughter and works with clients all over the world. Visit her online at lauraschaeferwriter.com and linkedin.com.