Understand & Get The Benefits You’re Entitled To.
Social Security Disability Insurance (SSDI) covers people in need of disability benefits. SSDI recipients receive a monthly paycheck based on their lifetime earnings, not based on the severity of their condition. A monthly stipend is given to recipients that may be up to $3,011 per month in 2020. Monthly SSDI benefit payments may also vary if you are receiving money for disability from another source.
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How Much Will I Receive?
The amount of your monthly benefit is based on your lifetime average earnings covered by the Social Security Administration (SSA) and is reduced if you receive other government benefits, such as workers’ compensation – including Black Lung payments – or public disability benefits.
What Formula does SSA Use to Calculate My Benefits?
Your monthly income for retirement and disability benefits takes into consideration the amount of money you have paid in Social Security taxes. The Social Security taxes are referred to as your “covered earnings,” and the average amount of covered earnings over a period of time is referred to as average indexed monthly earnings (AIME). AIME is a formula that uses your monthly wages, adjusted for inflation, to determine your primary insurance amount (PIA), and it is unique to each individual. The PIA is the base figure the SSA will use when determining the amount of money you will receive. This formula uses fixed percentages of various amounts of income (bend points), which change each year.
To check over your Social Security earnings, you can look at your yearly Social Security Statement. People over the age of 60 will receive a statement every year, while those not receiving benefits will get printed statements every five years. We encourage you to view your statement online by visiting www.ssa.gov/mystatement/. The SSA also has an online benefit calculator so you can enter salary information; you will automatically receive a record of your earnings and an estimate of future earnings, but you can also track earnings yourself through www.socialsecurity.gov/planners/benefitcalculators.html or have a Social Security representative help you figure out your future earnings.
Reductions to SSDI Benefits
Certain monetary benefits from other sources may affect your Social Security payments. SSI and VA benefits will not affect your SSDI benefits. If you are granted benefits from a private long-term disability insurance policy, your SSDI benefits will not be lowered (however, your long-term disability benefits may be).
On the other hand, payments from government-regulated disability benefits, such as worker’s compensation, or temporary state disability benefits, will affect how much you can earn monthly. Normally, the amount you receive in benefits cannot be more than 80% of the average amount you earned before you became disabled. In some states your SSDI award will be reduced if you do receive more than 80% of your past earnings, while in other states the other benefit, such as worker’s compensation, will be reduced instead.
Back Pay for Social Security Benefits
Your monthly SSDI benefit will determine the amount you receive in back pay. The number of months of back pay you receive will be based on when your disability started or when you filed an application for benefits. It is important to file your application soon after becoming disabled to avoid losing back pay to which you may be entitled. If you had applied for disability previously, you may have a chance of earning back pay from the first date of applying for SSDI.
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Brown & Brown can help you better understand and take advantage of the many benefits of Social Security Disability, to help maximize your financial well-being during your period of disability.