Social Security Disability (SSD) benefits are distributed through the Social Security Administration (SSA) for those who have become disabled and unable to work, yet are too young to start receiving retirement benefits.
When you are employed, you pay into the Social Security Disability Insurance (SSDI) fund through your payroll taxes. In this way, your SSDI contributions can be used in the event that you are forced to retire early due to your disability, as you will still be too young to receive your retirement benefits. Note that SSDI benefits are different from SSI benefits, which are paid through general taxes and are only available for low-income people or those without a work history.
SSDI Benefits for Early Retirement
If you are disabled and collect SSDI benefits through the SSA, they will be converted to retirement benefits when you reach the full retirement age. One exception to this rule is if you take early retirement. At age 62, you will become eligible to take early retirement through the Social Security Administration (SSA).
If you were disabled before the early retirement benefits start, the SSA will retroactively pay the different between your retirement benefits and SSDI benefits for the months that you were disabled but receiving the early retirement benefits. On the other hand, if you were collecting early retirement benefits and then became disabled and applied for your SSDI benefits, the SSA would not pay the different in amounts.
SSDI Benefits for Retirement Age
The full retirement age in the United States generally falls between 65 and 67. Your age of full retirement depends on the year you were born. The following years of birth determine your age of full retirement:
- 1937 or before, it is 65 years old
- 1938, it is 65 and two months
- 1939, it is 65 and four months
- 1940, it is 65 and six months
- 1941, it is 65 and eight months
- 1942, it is 65 and ten months
- Between 1943 and 1954, it is 66 years old
- 1955, it is 66 and two months
- 1956, it is 66 and four months
- 1957, it is 66 and six months
- 1958, it is 66 and eight months
- 1959, it is 66 and ten months
- 1960 or later, it is 67 years old
When you do reach full retirement age, there is not much difference to how you receive benefits. The amount of money will neither increase nor decrease when you switch benefit type. One small change is that your benefits money will come from a different place – the SSA’s retirement benefits fund instead of the SSA’s SSDI benefits fund.
Another change to your benefits is that there is no more earning limit in place for retirement benefits, as there is for SSDI benefits. This means that you can increase the amount of money you make through a part time job or other source of income after you retire, and it will in no way affect your retirement benefits amount.