The intersection of disability and retirement benefits can be an important one, especially when considering how to manage your Social Security Disability (SSD) benefits.
With one small exception, you cannot receive SSD benefits and Social Security retirement benefits at the same time. The purpose of SSD is to provide benefits to those unable to work because of a disability and who are too young to draw Social Security retirement benefits. This means that even if you do collect SSD disability benefits, you will be converted to Social Security retirement benefits once you reach retirement age.
What is an Early Retirement Exception?
The only exception to the above is if you took early retirement at age 62 through Social Security before being approved for disability benefits. In this situation, you are eligible to receive some combination of both benefits.
Let’s say you drew less than the full monthly retirement benefit under early retirement, and then you were subsequently approved for disability benefits. Social Security would make up the difference between the amount allotted for early retirement and the full disability amount for the months during which you were disabled and receiving reduced early retirement benefits.
This is a retroactive benefit. In this situation, you would also get the benefit of a disability freeze, meaning your lack of income as a result of your disability would not be counted when your Social Security retirement payment was calculated from your earnings record.
What are the Risks of Early Retirement?
Some risks are involved with early retirement. If the Social Security Administration (SSA) decides you did not become disabled until after you began collecting early retirement, then the SSA will not pay the difference between early retirement pay and disability pay.
Also, if the SSA denies your disability claim, you will receive early retirement payments at that rate for the remainder of your life.
When Should You Apply For Retirement Benefits?
Many people who quit work at age 62 apply for disability at the same time they elect for early retirement benefits. This allows the early retirement payments to fill the income gap until your claim for disability is approved. It also provides you with retroactive relief from the difference in amounts.
However, there is no guarantee that your disability benefits claim will ultimately be approved, in which case you will be resigned to collecting the lower early retirement payments for the rest of your life.
If you are severely impaired, however, this might be a good option to consider. Being approved for disability benefits is easier for those age 60 or older, and special consideration is given to those over age 65.
How to Apply
The SSA offers an online retirement application that can be completed very quickly. Once the application is submitted electronically, you do not have to take any further action. You do not need to sign any documents or return any notarized forms.
The SSA will contact you if additional information is needed. If you do not wish to apply for Social Security benefits online, you can apply in person at any SSA field office. They are located throughout the state of South Carolina, and you can find the one closest to you on the SSA website.
Contact an Attorney if You Need Assistance with Your Case
The Social Security benefits attorneys at Land Parker & Welch have extensive experience with helping South Carolina residents to manage disability and retirement benefits. Call or contact us online if you would like to discuss a strategy for managing the Social Security process.