Who Qualifies for Social Security Disability Benefits?

Dear Carrie,

I'm 59 and recently suffered a severe injury that prevents me from working, possibly for several years. How do I qualify for Social Security disability benefits?

—A Reader

Dear Reader,

I wish there was a quick and easy answer to your question, but unfortunately there's nothing quick and easy about Social Security disability benefits (SSDI). There are a lot of rules and regulations regarding these benefits, and it's tough to qualify for them. In fact, most applications are denied. For instance, according to SSA statistics over the past several years, an average of 64 percent of disability claims were denied.

I don't mean to sound discouraging, just realistic. Because while it appears that you do meet a couple of the qualifications—you're under your full retirement age and you have a medical condition that is expected to last at least one year—the application and screening process is generally arduous and slow.

I can walk you through the basics so you'll have some information to draw on as you start the process.

Basic SSDI qualifications

As I said, there are very specific regulations around disability benefits, and qualifications are strict. To qualify:

• You must be younger than your full retirement age (FRA).
• You need to have accrued enough Social Security work credits to pass two earnings tests: the “recent-work test” and the “duration-of-work test." The credit requirement is a sliding scale, based on your age (fewer years the younger you are). At age 60 you must have had Social Security-covered employment for five out of the last ten years. You also must have worked at Social Security-covered employment for a total of at least 9½ years.
• Your medical condition must be so severe that you are incapable of working and it will last for at least one year or until death.
• You can’t earn more than a minimal amount of money ($1,260 per month in 2020; $2,110 per month if you're blind). However, there's no limit on the amount of assets or unearned income you have or how much income your spouse has.

There are certain medical conditions that automatically define you as disabled. The SSA maintains a list that you can get at www.socialsecurity.gov/disability. If your condition is on this list, the application process may be a bit faster. It’s worth checking into.

How benefits are determined

If you qualify, your benefit is based on your average lifetime earnings. Generally you’ll receive the same amount that you would receive from Social Security at your FRA. The average SSDI monthly benefit is $1,258 (as of 2020).

It's important to realize that once you reach your FRA, SSDI benefits are automatically switched to your Social Security retirement benefit. You don't receive both. Also be aware that your benefit may be reduced in certain circumstances, for instance if you receive other state or federal benefits such as worker's compensation.

As a side note, you get automatic Medicare coverage after you've received SSDI benefits for two years, regardless of your age.

Family benefits

On the bright side, your family members may also be able to collect benefits based on your disability once you qualify—up to 50 percent of your basic benefit subject to a "family maximum" of between 150 and 180 percent of your benefit.

These family members include:

• Your spouse age 62 or older provided you were married at least one year.
• Your spouse at any age if he or she is caring for your child who is age 16 or younger, or disabled.
• Your unmarried children under age 18.
• Your children under age 19 if full-time students (through high school), or disabled.
• Severely disabled children over age 18.

Similar to spouses, ex-spouses also can collect if age 62 or older as long as you were married at least 10 years, or at any age if caring for your child who is 16 or younger, or disabled.

The application process

You'll have to compile a library of information about yourself, your work history, and your medical condition, and complete numerous forms. The more thorough and accurate you are from the start, the more likely you are to speed up the process. It can be extremely helpful to work with a disability attorney to help you navigate the process, but make sure you understand any fees, costs, and services upfront.

If your claim is approved, your first check will cover the sixth full month after your disability began, with payment starting the next month (for the month prior). If your claim isn’t approved, you can appeal the decision—but you generally have to do so within sixty days. A bit of good news here is that you may have a better chance of being approved on appeal than you had on the first go-round.

The SSA states that an application for disability benefits can take three to five months, so if you believe you qualify, don't delay. You can apply online at www.socialsecurity.gov/disability or by calling 1-800-772-1213. You can also contact your local Social Security office. Best of luck!

Have a personal finance question? Email us at askcarrie@schwab.com. Carrie cannot respond to questions directly, but your topic may be considered for a future article. For Schwab account questions and general inquiries, contact Schwab.