Navigating the world of Social Security Disability Insurance (SSDI) can be a daunting task. Whether you’re applying for the first time or trying to understand the benefits you’re entitled to, it’s important to have a clear understanding of how much you can receive and when these payments will be made. In this blog post, we’ll dive deep into the details of SSDI benefits, providing you with a comprehensive guide to help you maximize your entitlements.
What is SSDI?
Social Security Disability Insurance (SSDI) is a program designed to provide income supplements to people who are physically restricted in their ability to be employed because of a notable disability (usually physical). SSDI is funded by the Social Security tax fund and requires that you have worked a certain number of years and have made contributions to the Social Security trust fund in the form of FICA Social Security taxes.
Eligibility Criteria
Before we discuss the benefits, it’s crucial to understand who is eligible for SSDI. The eligibility criteria for SSDI are primarily based on your work history and the severity of your disability. Here are the key points:
- Work Credits: Depending on your age at the time of your disability, you generally need to have earned a certain number of work credits. Typically, you can earn up to four credits per year, and you need 40 credits to qualify, 20 of which were earned in the last 10 years, ending with the year you become disabled.
- Severity of Disability: SSDI benefits are only available to those who have a severe, long-term, total disability. The Social Security Administration (SSA) defines this as a disability that is expected to last at least one year or result in death, and it must prevent you from performing substantial gainful activity (SGA).
How Much Can You Receive?
The amount of SSDI benefits you can receive primarily depends on your average lifetime earnings before your disability began. Unlike Supplemental Security Income (SSI), SSDI is not based on financial need, but rather on your earnings record. Here’s how it’s calculated:
Calculation of Benefits
- Average Indexed Monthly Earnings (AIME): The SSA calculates your AIME by taking your up to 35 highest earning years, adjusting them for inflation, and averaging them.
- Primary Insurance Amount (PIA): This is the base figure the SSA uses to determine your benefit amount. The calculation involves applying a formula to your AIME, which consists of fixed percentages of different amounts of earnings (bend points). These bend points change yearly.
Example Calculation
Let’s say your AIME is $5,000. In 2023, the formula to calculate the PIA is:
- 90% of the first $1,115 of your AIME, plus
- 32% of your AIME over $1,115 and up to $6,721, plus
- 15% of your AIME over $6,721.
This formula results in your monthly benefit amount, which is adjusted annually for cost-of-living increases.
When Will You Receive Your Benefits?
Understanding when you will start receiving your SSDI benefits is just as important as knowing how much you will receive. Here’s what you need to know about the payment schedule:
Waiting Period
There is a five-month waiting period for SSDI benefits, meaning your benefits will start on the sixth full month after the date your disability began. However, you can apply for benefits as soon as you become disabled.
Payment Schedule
SSDI benefits are paid monthly. The payment date depends on your birthday:
- If your birthday is on the 1st through the 10th, benefits are paid on the second Wednesday of each month.
- If your birthday is on the 11th through the 20th, benefits are paid on the third Wednesday of each month.
- If your birthday is on the 21st through the 31st, benefits are paid on the fourth Wednesday of each month.