Anyone can become temporarily or permanently disabled. In fact, many experts believe that Americans in their 20s today have about a 30% chance of experiencing a disabling condition severe enough to cause at least three months of missed work before they retire. Yet despite the significant risk of disability, most Americans have neither short-term nor long-term disability insurance

If you sustain an illness or injury that leaves you unable to work, what can you do? One option is to apply for monthly disability benefits through the Social Security Administration, which also provides retirement benefits to seniors. However, qualifying for Social Security disability benefits can be complicated, and the bar for qualifying is set fairly high.

If you think you may come to rely on Social Security disability benefits -- or if you simply want to find out how they work -- this complete guide will provide the answers you need. 

Disabled woman in wheelchair being pushed by caregiver

Image source: Getty Images.

What are Social Security disability benefits?

Social Security disability benefits are monthly payments that help support people who become too disabled to work. There are two different programs through which the SSA pays disability benefits. Those programs are:

  • Social Security Disability Insurance (SSDI)
  • Supplemental Security Income (SSI)

Although both programs use the same basic definition of "disabled," and there's some overlap between the programs, there are also major fundamental differences. SSI and SSDI are intended for two different groups of disabled workers; the benefits and qualifying requirements differ; and the funding sources are different. 

What is Social Security Disability Insurance?

Social Security Disability Insurance is a safety net program that essentially insures workers in the case they get sick or injured and can't work as a result. However, with SSDI, you don't pay premiums to an insurance company. Instead, you pay Social Security taxes out of each paycheck, and a portion of this tax money goes to fund the SSDI program. 

If you have a qualifying disability, you can apply for SSDI benefits. These benefits can be paid to you the entire time you're disabled until you reach retirement age and transition to retirement benefits. 

How much income does SSDI provide?

If you qualify for SSDI, the amount of income you receive is determined by your work history and the wages you earned over your career. A similar approach is used to calculate Social Security retirement benefits. As with retirement benefits, the SSA calculates your average wages over your working life and plugs that number into a formula, and the result is the amount of your monthly check.

However, with retirement benefits, the SSA looks at your average wages over the 35 years when you earned the most -- but you may not have a 35-year work history if you've become disabled. To determine how many years of wages to consider in calculating SSDI benefits, the SSA:

  • Subtracts 22 from your current age. So, if you were 50, you'd subtract 50-22 = 28 
  • Takes one-fifth of that number and rounds down to the nearest whole number. So, you'd take 1/5 of 28 in our example, which equals 5.6 and which rounds down to 5.
  • Subtracts the second number from the first. If the second number is less than two, then SSA subtracts two instead. If it's more than five, the SSA subtracts five. In our example, the SSA would take 28-5, so it would consider 23 years of work history.

The SSA looks at your earnings over this designated number of work years (23 in our example), adjusts your wages for inflation, and calculates your average indexed monthly earnings (AIME). Once the SSA determines your AIME over the appropriate number of years, you'll receive benefits equal to:

  1. 90% of the first $895 in AIME
  2. 32% of AIME between $895 and $5,397
  3. 15% of AIME above $5,397

This is the formula as of 2018. You can also sign into your Social Security account (or create a new one) to find out how much you'd receive in SSDI benefits if you became disabled.

As of 2018, the maximum SSDI benefit is $2,788 monthly, while the average benefit is $1,197 per month.   

How do you qualify for SSDI?

To qualify for SSDI, you need to meet some basic requirements.

  • You must have earned a sufficient number of work credits.

Work credits are basically points you accumulate by earning, and paying Social Security taxes on, a certain amount of money. In 2018, you earn one work credit for every $1,320 in wages or self-employment income. You can earn four credits per year, so once you've earned $5,280 in taxable income in a year, you can't earn any more credits until the next year.

The specific number of work credits you need to qualify for SSDI will vary depending how old you are when you become disabled. As a general rule, you can potentially qualify if you've earned at least 20 credits in the 10 years prior to becoming disabled and if you've earned a total of 40 credits or more.

However, if you're younger when you become disabled, the work credit requirement is reduced based on age. For example, if you're under 24 when you become disabled, you can become eligible for SSDI if you've earned at least six work credits in the three year period before your disability occurs.

If you're between the ages of 24 and 31, you can qualify if you've earned work credits at least half the time between age 21 and the time you develop your disability. If you're between the ages of 31 and 62, there's a chart showing the number of credits you need. 

  • You cannot be engaged in substantial gainful activity

"Substantial gainful activity" (SGA) is basically defined as earning at least a certain amount of income from work (earnings from other sources don't count in determining SGA). The SGA level changes periodically. In 2018, if you earn at least $1,180 per month from working -- or $1,970 per month if you're blind -- you won't be allowed to receive SSDI, benefits because the SSA will deem you to have engaged in substantial gainful activity. 

This restriction exists because the SSA wants to make sure your disability is in fact preventing you from working. If you earn a regular paycheck, then by definition you are not too disabled to work.

  • You have to meet the definition of disabled

We'll talk about this in greater detail later, but generally, this means you need to have a serious long-term medical condition that prevents you from working. The cause of your impairment doesn't matter -- it can be the result of an accident, an illness, or any other cause. The important thing is that you meet the SSA's specific and narrow definition of what it means to be disabled.

  • You must be unable to do any job you're qualified for

You must be unable to do not only the job you were doing when you became disabled, but also any other job for which you're qualified. The SSA will look at your transferrable skills to find out whether you can do any work despite your disabling condition.

In general, the younger you are, the more likely it is that the SSA will decide you have transferrable skills and can find some type of work despite your disability. 

What if you don't have enough work credits?

If you don't have enough work credits to qualify for SSDI, it's possible you may be able to qualify based on a spouse's or parent's work record. For example:

  • Widows or widowers between the ages of 50 and 60 who become disabled may qualify for widow's disability benefits based on a spouse's work history. 
  • If you become disabled before age 22, you can be classified as an adult child and potentially become eligible for SSDI benefits based on a parent's work history. 

The Social Security Administration has more information on qualifying for benefits on a family member's work history. If you can't qualify based on your own work record or a family member's work record, then you will not be able to get SSDI benefits. However, you may still be eligible for disability benefits through the Supplemental Security Income program.

What is Supplemental Security Income?

Supplemental Security Income benefits are awarded to with a disabling condition, a low income, and limited resources. Seniors over 65 can also qualify for SSI benefits.

SSI benefits are funded through general tax revenue, rather than through special taxes collected solely for the program. You can qualify for these benefits regardless of your work history, but you must have low income and few valuable assets.

How much can you receive in Supplemental Security Income?

The monthly income you'll receive from SSI is typically lower than the monthly benefit you'd get from SSDI. It's not based on past wages but is instead a fixed amount based on the federal benefit rate. 

As of 2018, the monthly maximum SSI benefit is $750 for eligible individuals and $1,125 for couples. 

How do you qualify for SSI?

You can qualify for SSI if:

  • You're aged, blind, or disabled

This would mean you're over 65, you're legally blind, or you meet the SSA's definition of disabled. The definition of disabled is the same for SSI and SSDI, and we'll cover that in more detail later. 

  • You have limited income 

You can't get SSI benefits if you're engaged in substantial gainful activity. The definition of SGA for SSI is the same as it for SSDI, so you won't be eligible for benefits if you earn $1,180 per month or more, or $1,970 per month or more if you're blind. 

Because SSI benefits are needs-based, there are other rules when it comes to income as well. If you have $750 per month or more in countable income, you can't qualify for SSI. If you have some countable income, your maximum $750 monthly benefit will be reduced on a dollar-for-dollar basis. 

The SSI counts only certain types income in determining whether you will receive reduced benefits or become ineligible. This includes income earned from working, workers' compensation or unemployment benefits, the Department of Veterans' Affairs, other Social Security benefits, or family or friends. If you're provided with free food or shelter, this also counts as income.

However, SNAP benefits, income tax refunds, certain other government benefits, loans, grants or scholarships for tuition, and the first $20 in income received in a month are not countable for the purpose of determining whether you can get SSI benefits. 

  • You have few assets

There's also a limit on how much you can own before you become ineligible for SSI. Individuals with more than $2,000 in countable assets won't qualify for SSI, while couples are allowed up to $3,000 in assets. 

Assets or resources that are counted for the purpose of determining whether you hit this $2,000 or $3,000 threshold include cash, bank accounts, stocks, savings bonds, vehicles, land, personal property, life insurance, and other things you own that you could convert into shelter or food. However, some of your assets -- such as the home you live in, one vehicle, and some personal property -- won't count when determining your resources.

If you give away your resources to fall below the asset limits, you could be disqualified from getting SSI benefits for up to 36 months. 

What is the Social Security Administration's definition of "disabled"?

To obtain disability payments from either SSI or SSDI, you must meet the Social Security Administration's definition of disabled. This is not as easy as it sounds. For the SSA to consider you disabled, your condition must:

  • Last a year, be expected to last a year, or be expected to result in your death. 
  • Significantly limit your ability to do basic activities necessary to work, such as walking, sitting, standing, or retaining and remembering information.
  • Be included in the SSA's "Listing of Impairments" (more on that shortly) or be medically equivalent to listed conditions. This Listing of Impairments is also called the "Blue Book."
  • Prevent you from doing any work for which you're qualified. 

More than half of all applicants for disability benefits are denied, often because their ailment does not meet this very limited definition of what it means to be disabled.

What is the Listing of Impairments?

The Listing of Impairments is a list of conditions or health problems the SSA has prepared that are usually considered severe enough to allow you to qualify for benefits. It's divided into Part A, which lists adult conditions, and Part B, which lists children's conditions. 

Within each part, there are specific categories of medical ailments that deal with different parts of the body, including:

  • The Musculoskeletal System
  • Special Senses and Speech
  • Respiratory Disorders
  • The Cardiovascular System
  • The Digestive System
  • Genitourinary Disorders
  • Hematological Disorders
  • Skin Disorders
  • Endocrine Disorders
  • Congenital Disorders that Affect Multiple Body Systems
  • Neurological Disorders
  • Mental Disorders
  • Cancer (Malignant Neoplastic Diseases)
  • Immune System Disorders 

In each of these individual subsections are diseases, disorders, and medical problems that the SSA believes may allow you to qualify for benefits. However, having a listed condition still isn't enough. The SSA also lists specific symptoms you must exhibit or criteria you must meet to qualify for benefits based on that condition.

For example, to qualify for disability benefits based on chronic heart failure, you must be undergoing treatment and still have medically documented proof of systolic or diastolic failure. The SSA even defines exactly what it considers to be systolic or diastolic failure.

The chronic heart failure also must result in: persistent symptoms of heart failure that interfere with daily living; three or more separate episodes of acute congestive heart failure over a consecutive 12-month period; or an inability to perform an exercise tolerance test for specified reasons, such as chest discomfort. 

For many listed conditions, there are extensive details about what symptoms you have to experience -- and with what frequency. If your condition isn't listed, you'll need documented proof it causes symptoms as severe as those exhibited by patients with ailments on the Listing of Impairments. 

How do you apply for disability benefits?

If you believe you meet the qualifying criteria to apply for disability benefits, you can:

  • Apply onlineYou can apply for SSDI benefits online if you're over 18, do not currently receive benefits, and have not been denied benefits in the past 60 days. That said, only certain people applying for SSI benefits can apply online. You must be between age 18 and 65, and you cannot apply online if you've been married, if you're blind, or if you've applied for or received SSI benefits before. You also must be applying for SSDI benefits at the same time. 
  • Apply at your local Social Security office.  You can call 800-772-1213 or contact your local Social Security office to schedule an appointment to submit an application for benefits. 

What you need to apply for benefits 

When you apply for benefits, you'll need to provide some basic demographic information, including details about:

  • Your work history
  • Your current earnings
  • Your household income and household assets
  • Your bank or financial institution
  • Your current and past employers
  • Up to five jobs you've held over the past 15 years
  • Other benefits you may be receiving
  • Your citizenship status
  • Discharge from the military (if applicable)

You will need to provide certain documents, including pay stubs, proof of citizenship, and W-2s. Most importantly, you will also need to provide information about your disabling condition, including detailed medical records.

Providing information about your medical condition

Providing proof of your disabling condition is the most important part of applying for Social Security Disability. You will need to provide any medical records you have in your possession and give the Social Security Administration authority to access other medical records.

The SSA wants to receive information about your condition from your treating physician. This is the doctor who sees you on a regular basis. The SSA only accepts medical information from licensed physicians and prefers to have records provided by experts in the field of medicine related to your disability. If you're applying because you have cancer, the SSA would expect to see medical records from your oncologist.

It's imperative that your doctor fully document your symptoms and any treatments you undergo; this will give you the best chance of obtaining SSDI or SSI benefits. The Social Security Administration may also ask you to undergo an examination or evaluation with one of its doctors at some point during the application or appeals process. 

How does the application process work?

When you provide details about your medical condition to the SSA, your local Social Security office reviews your basic information to see if you could potentially qualify based on income and work history. 

Your file is then sent off to a disability claims examiner who will review all of your medical documentation. The claims examiner will make a decision on your case, and you'll be notified via mail whether your claim has been approved or denied. It usually takes around a month to 90 days to receive the decision on your application. 

What if your application is denied?

The denial rate for Social Security Disability benefits is very high, so there's a significant chance your application won't be approved. If your claim is denied, there are multiple stages of appeal, including:

  • Request for reconsideration, which means a new disability claims examiner reviews your claim again
  • A hearing before an administrative law judge (ALJ)
  • A review by the Social Security Administration's internal appeals board
  • Appeal to a federal court

The decision not to award you benefits could be reversed at any stage of the appeals process. For example, your request for reconsideration could result in your benefits being approved and you wouldn't need to move on to additional appeals. However, you must go through each phase if your claim continues to be denied and you want to keep fighting. 

If you must appeal a benefits denial, the process of getting benefits can take a very long time. In fact, depending where you live, it may take around a year for a hearing to be scheduled. You may be able to attend your hearing via video if you're unable to attend in person.

All of these stages of appeal take place within the Social Security's administrative process until you get to the federal court appeal. The ALJ works for the Social Security Administration but is still supposed to impartially weigh the evidence to determine whether your claim was handled properly.

If you don't already have an attorney and your benefits claim is denied, it's often best to get legal representation so a knowledgeable advocate can guide you through the appeals process.

Compassionate allowance conditions

Although it generally takes a lot of time and effort to receive Social Security Disability benefits, some people who are very sick with a serious medical condition may be able to get their claims approved through a streamlined process.

This is possible if you have a Compassionate Allowance Condition, or a condition on the SSA's Compassionate Allowance List. Listed conditions include metastatic cancers, Amyotrophic Lateral Sclerosis (ALS), Lewy Body Dementia, some genetic conditions, and a number of other serious ailments.

When you specify that you have a medical condition included on the Compassionate Allowance List, your application will be fast-tracked, and you may get a decision in as little as 10 days from the time you apply for benefits. You may also need to provide only a small amount of objective medical data, rather than having to meet extensive requirements for documenting your ailment, as most other applicants must provide. 

Applying for disability benefits could provide the income you need

When you're physically or mentally disabled due to an illness or injury, the last thing you need is to worry about your finances. Social Security disability benefits provide a secure source of income so you can provide for yourself and your loved ones. You should apply for benefits as soon as possible if you're eligible so you will have the money you need to be financially secure and maintain the highest quality of life you can.

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