Social Security Disability & Retirement

Social Security disability converts to retirement benefits upon full retirement age.

Social Security administers both retirement and disability programs. Disability is available to those who have worked in the past, but have become disabled and are unable to work, while retirement benefits become available when a worker is at least 62 years old. Those who have worked long enough to qualify for disability benefits will eventually also qualify for retirement benefits.

Social Security Disability Insurance

The Social Security Administration manages two disability benefit programs: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). If a person works a job in which she pays Social Security taxes, and then becomes disabled, she may be eligible to receive SSDI. Eligibility for SSDI is determined in part by how long the applicant worked and paid into the Social Security system. Younger workers can qualify with a shorter Social Security work history than older workers.

While the Social Security Administration does manage the SSI program, funds for SSI come from general tax revenues, not Social Security worker contributions. SSI provides income to disabled children, as well as to both disabled and elderly adults who did not work long enough to qualify for SSDI or Social Security retirement benefits.

Social Security Retirement

Social Security retirement benefits are paid to workers who contributed to the Social Security system throughout their careers. Depending on the amount paid into the system, a beneficiary will receive ongoing cash income for themselves, and certain family members, from the time that they retire. If a worker dies before or after they retire, their family members may also be entitled to survivor's benefits.

Full Retirement Age

While it is possible to claim reduced retirement benefits starting at the age of 62, the Social Security Administration defines "full retirement age" according to the year in which a worker was born. When a worker reaches full retirement age, they can draw a full retirement benefit, rather than the reduced payment that is made to those who retire early.

Benefit Amount

When a person who receives SSDI reaches full retirement age, the SSDI claim automatically converts to a Social Security retirement claim. The SSDI recipient does not have to take any action, the Social Security Administration handles the conversion. The cash benefit amount does not change.

Work Restrictions

While a disabled worker is receiving SSDI benefits, she is restricted in the amount of money that she can earn through work, though there are no restrictions on the value of any assets she might own, such as a house. The limit on monthly employment income for an SSDI recipient is adjusted each year by the Social Security Administration. After the conversion of SSDI to retirement benefits, the recipient is no longer restricted in working or earning wages. The recipient can work and earn, as much as she likes.

References

• Social Security Administration: Effect of Full Retirement Age on Social Security Benefits
• Social Security Administration: Retirement Benefits
• Social Security Administration: How Much Work Do You Need?
• Social Security Administration: Disability Benefits
• Social Security Administration: How Many Credits You Need