Ask Larry

If I Apply For Retirement Benefits Will My Disability Payment Be Reduced?

Hi Larry
I am turning 62 in 6 months. I have been sick and stop working since October 2020, i started my application for SSDI about 7 months ago and currently waiting for decision to be made by SSA Hearing office. If I apply for retirement when reached age 62, would my disability payment will be reduced if approved?
Thank you

Hi. Your Social Security disability (SSDI) benefit rate won't be reduced as long as your initial month of SSDI entitlement is the same as or earlier than your first month of retirement benefit entitlement.

For example, let's say Amy was born 2/02/1960 and she files for both SSDI and Social Security retirement benefits on her 62nd birthday. Amy's primary insurance amount (PIA), which is equal to her full retirement age rate or her full SSDI rate, is $2000. While Amy's SSDI claim is pending, Amy starts out being paid her reduced age 62 retirement rate of $1400. Amy's SSDI claim is later approved, and her disability onset date is established as January 1 2022.

There is a 5-month waiting period for SSDI benefits starting with the person's onset date. Therefore, Amy's SSDI waiting period is January through May 2022, and her first month of SSDI entitlement is June 2022. Therefore, since Amy collected retirement benefits for 4 months (i.e. February through May 2022) prior to becoming entitled to SSDI benefits, her SSDI rate is reduced from $2000 to $1955.

In our example above, if Amy's SSDI entitlement date had ended up being the same or earlier than her retirement benefit entitlement date, then Amy would have received her full unreduced PIA of $2000. Also, just to be clear, Amy can't be paid both retirement and SSDI benefits for the same month(s). So, Amy would start out getting $1400 for 4 months prior to switching to her higher SSDI rate of $1955 effective with June 2022.

Best, Jerry

Feb 11 2022 - 4:57pm
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