We continue to hear a lot about agism in the workforce. Major companies commonly skirt laws aimed at protecting older workers from age-based discrimination. It seems with every downsizing we see a steady stream of “institutional knowledge” leave the workforce after decades of service, only to be replaced by younger, greener, cheaper employees.
But disability remains the chief threat for those who by desire or financial necessity continue to work into traditional retirement age. A rising retirement age for Social Security retirement benefits is another factor impacting an aging workforce, as is the graying of the Baby Boomer generation. The Social Security Administration continues to raise the retirement age, which is currently about age 67.
As the Delaware Daily Times recently reported, health conditions such as heart disease, cancer, arthritis, stroke and Type 2 diabetes are among the chronic illnesses that can interrupt someone’s time on the job as disability among older workers increasingly becomes an issue for the U.S. workforce. Experienced disability lawyers in Boston know Social Security Disability Benefits can help bridge the financial gap for workers whose physical condition has caught up with their desire to remain in the workforce.
Older workers may receive better monthly benefits and earlier access to Medicare and Medicaid, while preserving and increasing their monthly retirement benefit until full retirement age.
Collecting Disability While Delaying Social Security Retirement
Recipients are eligible to begin collecting Social Security retirement benefits as early as age 62 but will see substantially higher benefits by waiting until 67, and nearly twice the benefits by delaying until age 70. An analysis last year by The Motley Fool estimated $1,000 in monthly benefits at retirement age would be worth $650 at age 62 and $1,320 at age 70.
Both Social Security retirement benefits and Social Security Disability Benefits are funded through payroll deduction during your working life. And both benefits are determined in part based on your income history. When injury or illness prevents you from remaining on the job, a Boston disability attorney may be able to preserve and increase your retirement benefits by winning disability benefits in the interim. SSDI benefits will also make it possible to collect government health insurance benefits at an earlier age. Medicare benefits start 24 months after you begin receiving disability benefits.
Those who have not yet reached full retirement age can be approved for disability benefits through proof of a Blue Book impairment or through medical-vocational allowances, which take into account age, limitations and work history. The Blue Book is a list of pre-approved conditions, including cancers and other terminal or seriously debilitating illnesses and conditions. For disability applicants over age 65, an Administrative Law Judge must carefully review the case file and applicant medical records for age-related impairments, such as loss of hearing, eyesight or memory loss that may impact employment. Thus, in some cases it may be easier for older applicants to win benefits as the court takes into account a claimant’s age and residual functional capacity.
For applicants over age 60, the SSA uses a grid system that takes into account education, previous work experience and a determination of residual functional capacity (sedentary, light, or medium). For instance, applicants without a high-school diploma, suitable for only unskilled work, will likely be determined disabled, while those able to do semiskilled work, or who have transferable skills or are capable of medium exertion under the RFC, may not be ruled automatically disabled.
By applying for Social Security Disability Benefits instead of retirement benefits your last years of employment (unemployment) will not be used to determine your retirement benefits, which can further increase your retirement income. For early retirees, the Social Security Administration allows you to apply for both retirement and disability benefits, typically allowing you to collect retirement benefits even while your disability application is pending, which can take 12-24 months. If you are awarded disability, you will also be awarded backpay to date of disability and your future retirement income will not be penalized for accepting early benefits because at age of disability the Social Security Administration sets your retirement benefit at full retirement age.
Social Security, Social Security Disability & SSI Benefits
In addition to Social Security Retirement Benefits, and Social Security Disability Insurance, recipients with little additional income and few assets may also be qualified for Supplemental Security Income, while receiving either retirement or disability benefits. These benefits may also include Medicaid and Supplemental Nutritional Assistance Program (SNAP) benefits.
In 2019, the average monthly SSDI for a disabled worker is $1,234, which is about $14,800 annually. For a disabled worker with a family, it increases to $2,130 per month, or $25,560 per year.
Another benefit of choosing SSDI benefits over retirement benefits is that you are afforded a number of return-to-work protections, including a trial work period of up to 9 months over the next 5 years, in which you can earn income while still receiving disability benefits. After that period, if you choose to return to work, you are still eligible for disability benefits for the next three years if your income falls below a certain level. These benefits can provide added time to increase your retirement income by delaying retirement benefits.
We recognize older workers have spent a lifetime contributing to the U.S. workforce. Social Security retirement and disability benefits are paid through payroll contributions of 13.5 percent. The move away from company sponsored pension plans to employee-contribution plans, such as IRAs and 401ks, has put many of this generation’s retirees on precarious financial footing. It’s vital that you seek experienced legal advice about the best way to claim all of the benefits to which your are entitled. While you have earned these benefits, and paid for them, what benefits you accept, and how and when you accept them, can have a major impact on your retirement.
If you or a loved one is seeking Social Security Disability Insurance in Boston, call for a free and confidential appointment at (617) 777-7777.
Does collecting Social Security disability affect retirement age?, Aug. 8, 2018, Newsday
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SCOTUS Reviews Use of Vocational Experts in SSDI Cases, Dec. 30, 2018, Law Offices of Jeffrey S. Glassman