Can You Collect Disability and Retirement at the Same Time?
Understand if you can receive both Social Security Disability and Retirement benefits simultaneously. Learn about the seamless transition at full retirement age.
Social Security benefits provide a financial safety net for millions of Americans, offering support during retirement, disability, or in the event of a wage earner’s death. These benefits are earned through contributions made via payroll taxes over an individual’s working life. The system aims to provide a baseline of financial security, reflecting a person’s average earnings history, funded by current and past workers’ contributions, and ensuring stability for eligible recipients.
Social Security Disability Benefits
Social Security Disability Insurance (SSDI) is an earned benefit for individuals who can no longer engage in substantial gainful activity due to a severe medical condition. Eligibility requires sufficient work credits, accumulated by working and paying Social Security taxes. The number of required work credits depends on your age when your disability began, though generally 40 credits are needed, with 20 earned in the last 10 years ending with the disability onset.
The Social Security Administration (SSA) defines disability as a medical condition preventing any substantial gainful activity, expected to last at least 12 months, or result in death. Your monthly benefit amount is determined by your average lifetime earnings before becoming disabled, specifically your average indexed monthly earnings (AIME). The severity of your disability does not influence the benefit amount; only your earnings record does.
Social Security Retirement Benefits
Social Security Retirement benefits are paid to eligible individuals upon reaching a certain age, providing financial support. To qualify, individuals must accumulate work credits, similar to SSDI, typically needing 40 credits earned over at least 10 years of work. These credits ensure that a person has contributed sufficiently to the Social Security system.
The Full Retirement Age (FRA) is the age at which an individual can receive 100% of their earned benefits. The FRA varies based on birth year; for those born in 1960 or later, it is age 67. Claiming benefits before FRA results in a permanent reduction, while delaying benefits past FRA, up to age 70, can increase the monthly payment.
Transitioning from Disability to Retirement
Individuals cannot collect both Social Security Disability Insurance (SSDI) and Social Security Retirement benefits simultaneously. Instead, when a person receiving SSDI reaches their Full Retirement Age (FRA), their disability benefits automatically convert to retirement benefits. This conversion is an automatic process handled by the Social Security Administration.
No new application is required for this transition. For most recipients, the monthly benefit amount remains consistent after the conversion. This is because the SSDI benefit is paid at a rate equivalent to what the individual would receive at their FRA, which is their Primary Insurance Amount (PIA). The reclassification simply changes the program under which the benefits are paid, not the payment amount itself.
Calculating Your Benefit Amount
The foundation of both Social Security Disability and Retirement benefits is the Primary Insurance Amount (PIA). The PIA represents the full benefit an individual would receive if they started drawing retirement benefits at their Full Retirement Age. This amount is determined by an individual’s Average Indexed Monthly Earnings (AIME).
AIME is calculated by taking up to 35 years of an individual’s highest indexed earnings over their working career, adjusting them for inflation, and then averaging them monthly. The SSA maintains detailed earnings records throughout a person’s working life, which are used to calculate and re-evaluate benefit amounts, ensuring accuracy during the transition.