January 21, 2022

What it is and how it pays

courtneyk / Getty Images

courtneyk / Getty Images

When most people talk about Social Security, they refer to the program’s retirement benefits, which provide monthly checks for some beneficiaries as early as age 62. But the Social Security Program also has many other advantages.

In fact, the so-called “Social Security taxes” withheld from your paycheck every payday are technically known as “Old Age, Survival and Disability Insurance” or OASDI. As the full name implies, in addition to “old age” or retirement benefits, you also pay taxes to support survivor and disability insurance benefits.

Here’s how to qualify for disability benefits and what to expect in terms of payout if you qualify.

Learn more: Understanding the Basics of Social Security
Also see: The biggest problems with social security

What it is

Social Security Disability Insurance (SSDI) is similar in some ways to private or company-sponsored disability plans. In other words, if you are so disabled that you can no longer work, the program will pay you a monthly income benefit. Like Social Security retirement benefits, disability insurance funds come from current employees, whose taxes fund the SSDI trust fund.


While the general structure of SSDI may be similar to that of other disability insurance policies, it is much more difficult to qualify. Only the most severely disabled are eligible for SSDI. However, the payouts are not partial or temporary.

As defined in the Social Security Act, a disabled person to qualify for SSDI must have a serious medical condition that will either prevent employment for at least one year or be expected to result in death. An eligible person should not be able to do any kind of work, not just work in a previously chosen field.

In general, you can only qualify for SSDI if you meet the same work requirements as you would for retirement benefits. This means that you must have completed at least 40 quarters of coverage, 20 of which were in the last 10 years before you became incapacitated. However, allowances are granted for younger employees.

View more: All States That Don’t Tax Social Security

How much does it pay?

While it is quite difficult to qualify for SSDI, the benefits are by no means a windfall. As of November 2021, the average monthly payment was only $1,282.39, although this amount is expected to increase to $1,358 by 2022.

However, as with Social Security retirement benefits, your SSDI payout is tied to your individual income. To calculate your benefit, the Social Security Administration examines your earnings data from age 22 and up to the age at which you became disabled. Between one and five of your worst-paying years are cut from the calculation, depending on how long you’ve been working.

Are there partner or family benefits?

Eligible spouses and children of eligible disabled employees may also receive Social Security benefits. A spouse must have a disabled child or child who is under 16 years of age or over 62 years of age to receive disability benefits. Divorced spouses are still eligible as long as they have been married for at least 10 years.

A child may be eligible for SSDI benefits if they are under age 18 or in high school and under age 19. People who were disabled before the age of 22 can also receive disability benefits from Social Security. [7]

Find: Everything You Need to Know About Collecting Social Security While You’re Still Working

What are the maximum payouts for SSDI?

For 2022, the absolute highest payout a recipient of SSDI could get is $3,345 per month, up from $3,148 in 2021. However, because payouts are based on earnings, only high-income earners are eligible for the highest SSDI payout. payout. Eligible spouses and children receive a minimum of the same as eligible disabled recipients, up to a maximum of 150% of the disabled person’s payout amount.

What is SSI?

Supplemental Security Income (SSI) is a safety net program for low-income individuals who may also be paying disability benefits. To be eligible, you must be 65 years of age or older and either blind or disabled. Unlike SSDI, SSI does not require working credits to qualify. However, you must have limited income and resources. Specifically, your net worth cannot exceed $2,000 for an individual or child, or $3,000 for a couple, and your monthly income for 2022 must not exceed $841 for an individual or $1,261 for a couple. These are also the maximum benefit amounts for 2022.

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This article originally appeared on GOBankingRates.com: Social Security Disability Insurance: What It Is And How It Pays

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