SSDI vs. Early Retirement: Which One Is Worth More in 2024?

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As you near retirement age you may begin considering how you will provide for yourself financially when you’re no longer working. If you have a disability or condition that prevents you from working, you may qualify for Social Security Disability Insurance (SSDI). 

However, collecting Social Security disability benefits isn’t the only way you may take advantage of benefits programs. According to surveys, many Americans are choosing to access early retirement benefits. Some even take retirement benefits early before they’ve actually stopped working. 

Don’t worry if you’re unsure of which option is right for you. This guide offers insights you may consider when making a decision. 

Changes in Social Security Benefits for 2024 

You likely have various questions about the topics of Social Security benefits. For instance, you may be asking “How much will Social Security increase in 2024?” or “What is the maximum Social Security retirement benefit?” 

Social Security benefits payments periodically increase to account for increases in the cost of living. The term for this adjustment is a COLA increase. 

Per the United States Social Security Administration (SSA) website, the Social Security 2024 COLA increase will be 3.2%. The increase will first take effect in January 2024, when more than 66 million Social Security beneficiaries will begin receiving larger checks than they’ve received previously. The change will take effect for those currently receiving SSI benefits on December 29, 2023. 

SSDI Benefits in 2024  

Maybe you’re looking into the topic of early retirement benefits not because you’ve reached the age when you expected to retire, but because a disability now prevents you from working and earning an income. 

You may qualify for SSDI if so. Through the SSDI program, you may receive monthly payments to help you cover the cost of food, housing, and other basic needs. 

To be eligible for SSDI, you must have: 

  • A condition that qualifies as a disability per the SSA’s Blue Book guide
  • Paid into Social Security in the past through your job
  • Earned sufficient work credits over your years of working 

Per the Social Security COLA increase in 2023, the maximum amount of SSDI one could receive on a monthly basis was $3,627. Most recipients don’t collect this much. On average, they receive $1,489 a month. With the Social Security 2023 COLA increase, the average recipient is likely to receive $1,537 a month. 

Further Reading: Social Security Disability Age Chart (for Work Credit Purposes) 

Early Retirement Benefits in 2024 

If you qualify for Social Security or SSI retirement payments, you may begin collecting the full retirement benefit when you reach full retirement age. The breakdown for when this occurs is as follows: 

  • 67 years of age if you were born in 1960 or later
  • 66 years and 10 months if you were born in 1959
  • 66 years and eight months if you were born in 1958
  • 66 years and six months if you were born in 1957
  • 66 years and four months if you were born in 1956
  • 66 years and two months if you were born in 1955
  • 66 years if you were born between 1943 and 1954 

You may take retirement early by claiming these benefits before reaching full retirement age. You can technically begin claiming retirement benefits once you reach the age of 62. However, the earlier you take retirement benefits, the less money you’ll be eligible to receive. 

Comparing SSDI and Early Retirement Benefits 

Depending on how early you begin claiming early retirement benefits, the amount you receive could be as much as 30% less than the maximum amount you would have received if you waited until you reached full retirement age to begin collecting benefits. 

Consider this if you’re not sure whether you should take early retirement or if you should apply for Social Security Disability Insurance benefits. 

Be aware that the amount of money you would receive from full retirement benefits is the same amount you would receive from SSDI. That means SSDI will always be worth more than early retirement benefits. 

You’re likely depriving yourself of money if you take early retirement benefits over SSDI. That said, there are exceptions in which it may make more sense for someone to take retirement benefits early. A lawyer could evaluate your situation and inform you of the best option. 

Strategies for Maximizing Social Security Benefits  

One of the best ways to maximize Social Security retirement benefits is to simply delay receiving them. If you’re willing to wait until you reach full retirement age to begin collecting benefits, you’ll likely receive much more money over time than you otherwise would. It’s also worth noting that your SSDI benefit automatically becomes a retirement benefit once you reach full retirement age. 

Other ways to potentially maximize your SSDI or retirement benefits include: 

  • Providing thorough medical documentation of the nature of your condition if you apply for SSDI benefits
  • Apply for spousal benefits, as your spouse may qualify to receive such a benefit on top of what you receive
  • Monitor for your Social Security check increase and contact the SSA if you don’t receive the increase you expected
  • If you have a disability, comply with your doctor’s recommended treatment plans 

Some who are choosing to take retirement early are doing so out of financial hardship. They know they’re going to collect less money in the long run this way, but they don’t see another option. 

Such an attitude is understandable. Perhaps you can relate. Just remember your finances will benefit more if you can wait until full retirement age to begin collecting retirement benefits. Look into state programs and local charitable programs to determine if there is a way to meet your financial needs without taking retirement benefits earlier than you originally planned. 

Speak With an Attorney About SSDI and Retirement Benefits 

Hopefully, the information here has answered some of your questions about the pros and cons of taking retirement early or applying for SSDI benefits. That said, it’s important to make an informed decision when choosing between these two options. Stay up to date on these matters by following the latest developments and consulting resources related to Social Security benefits. 

Also, consider taking our Free Case Evaluation on this page right now to get connected and speak with a disability lawyer who can help you today—all at zero cost to you. They can discuss your case in further detail and provide you with specific, individualized guidance on your options. 

Additional Resources  

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