I’m 59 and recently suffered a severe injury that may prevent me from working for several years. I’ve heard that I might qualify for Social Security benefits. Is that true?
I wish there were a quick and easy answer to your question, but unfortunately there’s nothing quick and easy about Social Security disability insurance (SSDI). There are a lot of rules and regulations, and it’s tough to qualify. In fact, most applications are denied. According to the SSA, in 2013, only 885,000 out of 2.65 million SSDI applications were approved.
I don’t mean to be discouraging, just realistic. But you should definitely look into it. I can walk you through the basics to get you started.
Basic SSDI qualifications
Here’s a quick run-through of qualifications:
- You must be younger than what the Social Security system has determined is your full retirement age (FRA).
- You need to have accrued enough Social Security work credits to pass both the “recent-work test” and the “duration-of-work” test. The younger you are, the fewer years of credit you need to qualify.
- Your medical condition must be so severe that you are incapable of working and it will last for at least one year or until death.
- You have to earn less than a specified amount of money ($1,070 per month in 2014; $1,800 per month if you’re blind). However, there’s no limit on the amount of assets or unearned income you have or how much income your spouse has.
There are certain medical conditions that automatically define you as disabled. The SSA maintains a list that you can get at socialsecurity.gov/disability. If your condition is on this list, the application process may be a bit faster. It’s worth checking into.
How benefits are determined
If you qualify, your benefit is based on your average lifetime earnings. Generally, you’ll receive the same amount that you would receive from Social Security at your FRA.
The maximum SSDI monthly benefit for 2014 is $2,642. The average monthly benefit is $1,148. SSDI benefits are automatically switched to your Social Security retirement benefit once you reach your FRA.
It’s also important to realize that your benefit may be reduced in certain circumstances—for instance, if you receive other state or federal benefits such as worker’s compensation. Once again, it’s complicated.
On the bright side, your family members may also be able to collect benefits based on your disability once you qualify—up to 50 percent of your basic benefit subject to a “family maximum” of between 150 and 180 percent of your benefit.
These family members include:
- Your spouse age 62 or older, provided you were married at least one year
- Your spouse at any age if he or she is caring for your child who is age 16 or younger, or disabled
- Your unmarried children under age 18
- Your children under age 19, if they’re full-time students (through high school), or disabled
- Severely disabled children over age 18
Similar to spouses, ex-spouses age 62 or older can also collect, as long as they were married at least 10 years. If they’re caring for a child who is 16 or younger, or disabled, they don’t need to be 62.
The application process
When you apply you’ll need to provide a host of information about yourself, your work history, and your medical condition, and complete numerous forms. But the more thorough and accurate you are from the start, the more likely you are to speed up the process.
If your claim is approved, your first check will cover the sixth full month after your disability began. If your claim isn’t approved (and most claims aren’t), you can appeal the decision—but you have to do so within sixty days. The only bit of good news here is that you have a better chance of being approved on appeal than you had on the first go-round.
The SSA states that an application for disability benefits can take three to five months, so if you believe you qualify, don’t delay. You can apply online at socialsecurity.gov/disability or by calling 1-800-772-1213. You can also contact your local Social Security office. Best of luck!
Looking for answers to your retirement questions? Check out Carrie’s new book, The Charles Schwab Guide to Finances After Fifty: Answers to Your Most Important Money Questions (Crown Business, 2014), available in bookstores nationwide. Read more at http://schwab.com/book.
This column is no substitute for an individualized recommendation, tax, legal or personalized investment advice. COPYRIGHT 2014 CHARLES SCHWAB & CO., INC. MEMBER SIPC. (0614-3778)