Social Security benefits are widely available to two groups of people: those over retirement age and those with a disability.
The amount available to those with a disability will change depending on which programs they qualify for, the extent of their disability and how much they paid into Social Security through FICA taxes (and/or self-employment taxes). The amount available to retirees will change based on the years worked, their “indexed” monthly earnings for that time, and other factors such as the rising cost of living.
You can learn about each of these benefits and who is eligible to receive them by reading further.
Social Security Disability
Social Security Disability, sometimes called Social Security Disability Insurance (SSDI), is a monthly benefit given to those who have worked the necessary number of work credits and who have been diagnosed with an eligible disability. The amount given is based both upon the extent of disability and the indexed earnings record of the applicant.
SSDI is only available to those under the age of 65. Their spouse and dependent children may be eligible to receive an auxiliary benefit, sometimes called a partial dependent benefit. SSDI payments are delayed until at least five months after the date the applicant became disabled, but applicants can recover back payments in many instances.
Those who have a disability and who receive SSDI payments for two years will become eligible for Medicare.
Supplemental Security Income
Supplemental Security Income (SSI) is a needs-based program that provides monthly benefits payments. Qualification is based entirely on needs and the total number of relevant owned assets, usually $2,000 individuals and $3,000 for couples. There is no work credit hours requirement and the benefits come from general fund taxes rather than FICA contributions through income tax.
Social Security Payments
Social Security payments are given to those at or over the eligible retirement age and who have contributed the minimum needed amount through FICA taxes. The amount available to recipients is calculated using a complex formula that takes up to 35 years of the recipient’s past earnings and indexes them to determine an average before applying additional modifications.
65 is the official retirement age under current Social Security law, although people as young as 62 can begin taking payments early with a penalty. The penalty can be fairly hefty, reducing payments by up to 30 percent. Conversely, waiting past 65 can provide increased payments.
If a person dies before they have received the full extent of their available benefits, their survivors may be entitled to further payments, known as survivor benefits. A one-time lump sum of $255 is given to either the surviving spouse, surviving children under the age of 18 and other potential recipients.
Others may receive ongoing monthly survivor benefits in these situations:
- They are over the age of 62 and the parent of a deceased worker on whose income they depended
- They were a child of the deceased and:
- Under the age of 18
- Under the age of 19 and attending school full time
- They were a spouse to the deceased, married to them for at least nine months and aged 60 or older; they can either have been married at the time of the worker’s death or divorced and not remarried before age 60
Consult With a Social Security Lawyer to Learn Other Rules, Exceptions, and Benefits
The above is just the general benefits potentially available to those with low incomes, disabilities or who have entered the official retirement age. Many exceptions and rules apply, so make sure to discuss your situation with a social security lawyer or a similar expert to ensure you can get as many benefits available to you as possible.