The last thing you want to hear after making it through a challenging application process and being approved for disability benefits is that your benefits may change when you reach age 65. The good news is that you will not lose your benefits, but this article explains changes to the benefits to expect as you get older.
Changes Depend On The Type Of Benefits
Social Security Disability Insurance and Supplemental Security Income are the two programs managed by the Social Security Administration that pay disability benefits. The SSDI program is part of the Social Security retirement system. It allows workers to receive the equivalent of their benefits when they become disabled and unable to work before retirement age.
SSI is a needs-based program that provides a monthly benefit payment to help individuals with little or no income and limited resources pay for housing, food, and other necessities. The program is open to individuals who cannot work because they are blind or disabled. Someone 65 or older who is not disabled or blind may also qualify for SSI, provided they meet the income and resource limitations.
The government pays SSDI benefits from the Social Security Trust Fund. Money in the fund comes from Social Security taxes. The treasury pays SSI benefits from the General Fund derived from personal income, corporate, and other taxes except Social Security taxes. This distinction in the source of funding for SSDI and SSI is why SSDI benefits change at retirement age while SSI benefits do not.
What Happens To SSDI Benefits When You Turn 65?
Injured workers who qualify disability benefits through the SSDI program receive the equivalent of their Social Security retirement benefits. When they reach retirement age, the disability benefits automatically convert to retirement benefits.
Typically, the conversion does not change the amount you receive each month except if you collected public benefit payments, such as workers’ compensation or a pension from a job not subject to payment of Social Security taxes. If your monthly SSDI benefits were reduced or offset by the amount of any public benefit payments, the reduction ends at retirement age, so your retirement benefits may be more than you received from SSDI.
Many people assume that the retirement age for Social Security is 65, but it depends on when you were born. The age when you qualify for 100% of your Social Security retirement benefits is full retirement age, and it was at age 65 for many years.
Things changed in 1983 when Congress passed a law gradually increasing the full retirement age. For example, someone born in 1959 could retire and receive retirement benefits upon reaching 66, but a person born in 1960 or later must wait until they are 67.
Do not confuse full retirement age with early retirement. You can begin receiving retirement benefits upon reaching 62 years of age, but you do not receive your full retirement benefit each month. The price you pay for retiring early instead of waiting until full retirement age is a lifetime reduction in the monthly Social Security retirement benefits.
SSI Benefits When You’re 65
SSI benefits are not funded by Social Security taxes or part of the Social Security retirement system, so disability benefits do not convert to retirement payments as they do with SSDI. That does not mean that a change does not occur for some SSI beneficiaries.
If you receive benefits through SSI because you are blind or disabled, the Social Security Administration periodically reviews your case to determine whether your medical condition continues to qualify disability benefits. At age 65, your eligibility status changes from disabled or blind to where you qualify based on age.
Your case no longer undergoes periodic disability reviews, but you must continue to meet the income and resource limitations to remain eligible for the program. If you have questions about this or other topics related to SSI or SSDI, contact an experienced disability benefits lawyer.
