DISABILITY BENEFITS IMPORTANT AS PORTION OF SOCIAL SECURITY

Most people think just of retirement benefits when they think about Social Security. Recent studies indicate, though, that one out of four workers entering the work force today will become disabled before they reach Social Security's normal retirement age. ~Disability~~~ benefits could be just as important as retirement benefits for these people.

~~~~Disability benefits were added to Social Security in August 1956. Today, Social Security administers two programs for disabled people: Social Security disability and Supplemental Security Income (SSI). The two have little in common except the same definition of disability.

There are three groups of disabled people who can get Social Security disability benefits:

disabled workers

disabled widows and widowers at least age 50

disabled adult children of deceased, retired or disabled workers

Disabled workers must be "insured" to get Social Security. That means they must work and pay Social Security taxes a required length of time. Insured status is measured in work credits (formerly known as quarters of coverage) which are awarded according to the amount a worker earns in a year. Up to four can be earned per year. In 1991, earning $540 in Social Security covered work nets one work credit. The amount needed to earn a work credit increases each year according to inflation.

The number of work credits required to get disability benefits depends on the age of the worker when he becomes disabled. Workers under age 24 need six credits in the three years before becoming disabled. Workers age 24 to 31 must have credits for half the time between age 21 and the start of their disability. Older workers must have credits for one-fourth of the time between age 21 and the start of their disability and at least twenty of those credits must be in the ten years immediately prior to becoming disabled.

The amount paid to a disabled worker is based on the level of earnings he had before he became disabled. Social Security disability benefits replace about forty-one percent of the average worker's wages. The average monthly disability benefit today is $587. The benefit for an average thirty-five year old wage earner becoming disabled this year would be about $750 per month. There is no minimum benefit.

Another way to qualify for Social Security disability benefits is as a disabled widow or widower. Surviving spouses usually have to wait until age 60 to collect those benefits from Social Security. But an exception to that rule has been made for disabled people. Widows and widowers who are at least age fifty can draw benefits if they became disabled within seven years of their spouse's death or within seven years of a prior period of entitlement to surviving spouse's benefits. The amount of benefit depends on the earnings the deceased spouse had.

Disabled adult children also qualify for benefits. A disabled adult child is someone who became disabled before age 22-before he had a good chance to work and become insured for disabled worker's benefits. When either of his parents dies or starts drawing Social Security retirement or disabled worker's benefits, a disabled child can also draw benefits. The amount is based on the parent's Social Security covered earnings. Disabled adult children usually continue to draw benefits as long as they remain disabled.

~It's possible to qualify for more than one kind of Social Security disability payment. In that case, only the greater of the two amounts is paid.

Social Security entitlement is not based on need. Even very wealthy people can qualify for benefits if they are disabled. However, there are limits to the amount of benefits payable if a disabled worker also receives worker's compensation or other public disability payments.

Social Security benefits cannot be paid for the first five full months of disability. The designers of the disability program assumed most people would have savings, insurance, sick pay or short term disability benefits form an employer to help them during that time.

For disabled people who don't have other income or resources in the waiting period, or can't qualify for Social Security disability benefits or qualify for only a small amount, there is SSI.

SSI began in 1974 when the federal government took over state programs aiding people who were elderly, blind or permanently and totally disabled. Today, SSI pays people who are at least age 65 or blind or disabled according to Social Security's definition of disability.

SSI is not Social Security. Benefits and administrative expenses are paid form general revenues of the federal government-not from Social Security taxes.

There are two basic differences between SSI and Social Security disability. One, because SSI if not Social Security, applicants don't need a work history to get SSI. Two, SSI entitlement is based on need-there are income and resource limits.

Resources can't exceed $2,000 for one person and $3,000 for a couple to get SSI. Usually, home, personal belongings and at least one automobile won't count against the limit. Cash, bank accounts, stocks, bonds and real estate other than the home are~ examples of resources that do count.

Generally, the income limits are $427 per month for one person and $630 for a couple. Those limits are higher, however, if some income is earnings-wages or self-employment income. In addition to earnings, income includes Social Security checks, pensions and other cash income. Non-cash income, such as free foo~d, clothing or shelter may also count.

Disabled children, even newborns, can get SSI, too. Parental income counts against children under age eighteen but only after deductions for other children in the household.

The SSI federal benefit rate is $407 for one person and $610 for a couple. Not everyone gets this amount, however. It's more in states that supplement SSI checks (Missouri and Illinois do not). It's less if the disabled individual has other income.

Many disabled people receive SSI during the five month Social Security waiting period. Because the payments are based on need, SSI requires no waiting period.

It's also possible to get Social Security and SSI at the same time. SSI is designed to supplement other income. So people who get a small Social Security check may also get SSI if they are blind, disabled or at least age 65.

There's one more requirement for entitlement to Social Security or SSI: filing an application.