It’s important to have safety nets in place that offer financial support and security because life is full of ups and downs. Millions of people and families in need can benefit from available programs in America. Two in particular are Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI). These programs can provide just that!
Even though these programs are great sources of support, a lot of people don’t fully understand just how these programs can help. In fact, through these programs, people can get monthly support. The amount of support depends on a variety of factors but can reach up to $3,822 in 2024!
Understanding SSDI and SSI
Before getting into the nitty gritty of these programs, you will want to know the basics and differences between them. SSI and SSDI are both administered by the Social Security Administration (SSA). They share a common goal of helping people in need through financial assistance. However, they cater to different populations and have distinct eligibility requirements.
What is SSDI?
Social Security Disability Insurance (SSDI) is a payroll-tax-funded insurance program designed to provide financial assistance to certain people. These people need to have paid into the Social Security system and can no longer work due to a qualifying disability. Eligibility for this program is based on work history and the severity of the disability, rather than the individual’s financial resources. SSDI benefits are calculated using the applicant’s average lifetime earnings, and after receiving SSDI for two years, the beneficiary becomes eligible for Medicare.
What is SSI?
Supplemental Security Income (SSI), on the other hand, is a needs-based program funded by general tax revenues. SSI is designed to provide financial assistance to low-income individuals who are either aged 65 or older, blind, or disabled. Unlike SSDI, SSI eligibility does not depend on work history. Instead, it focuses on the applicant’s income, resources, and disability status.
Key Differences Between SSDI and SSI
When it comes to these programs, some people easily confuse them. However, there are key differences you want to keep in mind like:
- Funding source: SSDI is funded through payroll taxes, while SSI is funded by general tax revenues.
- Eligibility criteria: SSDI is based on work history and the severity of the disability. On the other hand, SSI focuses on income, resources, and disability status.
- Benefit calculation: SSDI benefits are determined by the applicant’s average lifetime earnings. Whereas SSI benefits are based on the federal benefit rate and the individual’s countable income.
- Healthcare benefits: SSDI recipients become eligible for Medicare after receiving benefits for two years. On the flipside, SSI beneficiaries typically qualify for Medicaid.
How Much Can You Get from Each Program
The financial benefits provided by SSDI and SSI programs differ based on various factors, such as the beneficiary’s work history, income, and the specific program they qualify for. In this section, we will outline the general guidelines for determining benefit amounts for both SSDI and SSI.
Keep in mind that both SSDI and SSI benefit amounts are subject to change due to annual COLAs and adjustments in the applicant’s income or circumstances. Additionally, recipients of both programs must report changes in income, resources, or living arrangements to the SSA, as these factors can impact the benefit amount.
The SSDI benefit amount is calculated using the applicant’s average lifetime earnings and the SSA’s benefit formula. This formula takes into account the worker’s average indexed monthly earnings (AIME) and primary insurance amount (PIA). In general, the higher the applicant’s average earnings, the greater the SSDI benefit they will receive.
As of 2024, the average monthly SSDI benefit was approximately $1,537, with the maximum monthly benefit reaching $3,822. However, these figures are subject to change due to annual cost-of-living adjustments (COLAs), which aim to ensure that benefits keep pace with inflation.
SSI benefit amounts are determined by the federal benefit rate (FBR) and the individual’s countable income. The FBR is the maximum monthly payment an individual can receive, which is adjusted annually for inflation. As of 2024, the FBR was $943 per month for individuals and $1,415 per month for couples, but these figures may change due to annual adjustments.
The actual SSI payment is calculated by subtracting the individual’s countable income from the FBR. Countable income includes earned income (wages, self-employment earnings), unearned income (Social Security benefits, pensions, unemployment benefits), and in-kind support (food or shelter provided by someone else).
In some states, SSI beneficiaries may also be eligible for a state supplemental payment, which is an additional amount provided by the state government to help meet the cost of living. The availability and amount of state supplemental payments vary depending on the state and the individual’s living arrangements.
How to Apply
Applying for SSDI and SSI benefits may seem daunting, but breaking down the process into manageable steps can make it easier to navigate. In this section, we will outline the application process for both programs, highlighting essential documents and resources to help you get started.
Applying for SSDI
- Gather necessary documentation: Before starting the application process, collect relevant documentation, including your Social Security number, birth certificate, medical records, work history, and a detailed description of your disability. This information will be crucial for demonstrating your eligibility for SSDI benefits.
- Submitting an application: The most convenient way to apply for SSDI benefits is through the Social Security Administration’s (SSA) online platform. Visit the SSA website (www.ssa.gov) and create or sign in to your ‘my Social Security’ account to start the application process. The online Disability Benefit Application will guide you through the necessary steps. Alternatively, you can apply for SSDI benefits by calling the SSA at 1-800-772-1213 or visiting your local Social Security office.
- Decision notification: You will receive a written decision regarding your application, typically within three to five months after submission. If your application is denied, you have the right to appeal the decision within 60 days.
Applying for SSI
People can begin the application process in a couple of different ways. Regardless of how they choose to do this, they can expect to provide some details about their current situation. This includes details about personal information and contact information. Just like SSDI, the application for this program is free. That means a good rule of thumb is to apply ASAP. There is no risk and a chance of reward! Even if you get denied, it costs you nothing.
The Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) programs serve as great sources of support for Americans in need. Understanding these programs can be overwhelming, but with the right information and resources, you can better understand the differences. Whether you are exploring these options for yourself or advocating on behalf of a loved one, understanding the ins and outs of these programs is important. That’s because they can provide a lot of financial support. For SSDI it can provide up to $3,822. On the other hand, for SSI it can provide up to $1,415 for couples or $943 for individuals.