Social Security Disability Insurance replaces part of earnings

What percent of earnings are replaced by SSDI?

Social Security Disability Insurance (SSDI) benefits replace part of a disabled worker's prior income. The fraction varies according to the earnings history; the lower the earnings the higher the replacement rate. It also varies according to whether you have family members who who qualify as auxiliary beneficiaries.

To get an idea of the wide variations in earnings replacement rates, consider a hypothetical example. Assume that three disabled workers, all age 45, were earning at three different salary levels when they became disabled in 2003. According to the Social Security Administration (SSA) the following earnings would be replaced in the following percentages by SSDI benefits.

Earnings $14,600 annually, replacement rate 60.4% (with qualifying family member, 83.7%)
Earnings $32,444 annually, replacement rate 44.6% (with qualifying family member, 66.9%)
Earnings $80,978 annually, replacement rate 29.2% (with qualifying family member, 43.8%)

The above is a simplified illustration; actual replacement rates will vary because of differences in workers and work histories. Also, as noted above, auxiliary benefits paid to dependent family members can significantly increase the replacement rate. (Source: SSA’s FY 2003 Performance and Accountability Report, Overview, page 10.)

Your situation probably does not match any of these hypothetical ones. For an estimate of what your personal SSDI benefit would be if you were disabled now, call SSA at 1-800-772-1213 and ask them to send you Form SSA-7004, Request for Social Security Statement. Or, on the Internet, go to: https://s044a90.ssa.gov/apps6a/isss/main.html

What are auxiliary benefits?

When you receive SSDI benefits, other members of your family may qualify for what SSA calls “auxiliary benefits” Here is what the agency says about auxiliary beneficiaries in its booklet, Disability Benefits, SSA Publication No. 05-10029:

Certain members of your family may qualify for benefits based on your work. They include:

● Your spouse, if he or she is 62 or older;
● Your spouse, at any age if he or she is caring for a child of yours who is younger than age 16 or disabled;
● Your unmarried child, including an adopted child, or, in some cases, a stepchild or grandchild. The child must be under age 18 or under age 19 if in elementary or secondary school full-time; and
● Your unmarried child, age 18 or older, if he or she has a disability that started before age 22. (The child’s disability also must meet the definition of disability for adults.)

NOTE: In some situations, a divorced spouse may qualify for benefits based on your earnings if he or she was married to you for at least 10 years, is not currently married and is at least age 62. The money paid to a divorced spouse does not reduce your benefit or any benefits due to your current spouse or children.

To follow developments in Social Security disability, visit: www.disabilityfacts.com

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