(ModernSurvival.org) – Most Americans know the United States government provides monthly payments to retirees from the Social Security Administration (SSA). This money is collected from workers through the money they earn over the years of their employment. In addition to retirement payments, the SSA distributes income to those whose income falls below the poverty line and some individuals with disabilities. Nearly 67 million Americans receive some form of Social Security benefits each month.
Since these benefits fall under three separate categories, it can be challenging to determine which one you and your family may qualify for. Each program has its own guidelines and requirements, but these often overlap with one another. If you’re trying to navigate through these programs for yourself or a loved one, learning the basics of each program is vital.
Social Security Retirement
Often referred to as just “Social Security,” this encompasses the retirement benefits every American receives once they reach the age of retirement (starting at 62). Beginning with your first job, you pay into the system with each paycheck you earn. The amount taken for Social Security is shown on your paystub and is taken out pre-tax. If you happen to be self-employed, this tax is taken when you file quarterly or yearly.
The maximum amount that any person can pay into Social Security is $9,114 per year, regardless of the individual’s income level.
The benefits you receive from Social Security are determined by a credit system. Generally, you will need 40 credits or ten years of work to qualify (if born after 1929). If you were born between 1943 and 1954, you can retire with full benefits at the age of 66. If you were born after 1955, you have to wait until 67. As a general rule, the longer you wait to retire, the greater your benefit payments will be. The benefit amount the government pays is based on your highest 35 years of earnings.
Social Security Disability Insurance (SSDI)
SSDI is there for those who suffer a disabling injury or condition that leaves them unable to work before retirement age. This applies to those suffering medical issues that prevent them from working for a year or more and those with terminal conditions. Temporary and partial disabilities do not qualify for SSDI.
Disability is determined by an individual’s diagnosis, the condition’s onset, prognosis, test results, and how the situation specifically impacts the activities they can perform. When seeking SSDI, your state’s Disability Determination Services (DDA) will ask questions to determine your ability to work and eligibility for disability benefits.
The benefit amount paid out by SSDI is based on previous work history and age, using an average of your income earned in the 10 years before the injury or medical condition. The maximum payment from SSDI is $3,627 per month in 2023.
Supplemental Security Income (SSI)
SSI is a federal program that provides monthly payments to older, blind, or otherwise disabled individuals with limited income. For 2023, the federal benefits rate (FBR) for single individuals on SSI is set at $914. Qualifying couples may receive up to $1,371.
SSI is meant to help recipients provide for their basic necessities, such as food, clothing, and shelter. The total payment you get from SSI may vary based on a number of factors. Some states kick extra funds to the program payments. The amount you receive will also depend on your income, bank assets, other assets like stocks and bonds, as well as the quantity of cash you have on hand.
If you qualify for SSI, you may also be eligible for other federal benefit programs such as housing assistance, SNAP, and more. Applying for multiple programs can be intimidating and confusing, but learning the basics will help you overcome these challenges.
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