I started receiveing SSDI when I was 55 years old and continued until I turned 62. I started working again and, God willing, I will continue working until I reach full retirement age at 66 and 4 months. Will my SS benefits be reduced because of my years on SSDI?

I lost my husband five years ago and have not filed for survivor benefits because my benefits were higher. Since I have returned to work, I make too much money to receive any survivor benefits.

Would it be better to collect my survivor benefits when I reach full retirement age or my own SS?

I was born 09/1956 and reach full retirement age in January of 2023. When will I be able to work and collect 100% of my benefits?

Thanks,
Patricia

Hi Patricia,

I'm sorry for your loss.

First off, the fact that you collected Social Security disability (SSDI) benefits for a time won't hurt your eventual Social Security retirement benefit rate. In fact, it will do the opposite. Social Security retirement benefits are normally based on an average of a person's highest 35 years of Social Security covered wage-indexed earnings. However, if a person was disabled and qualified for SSDI benefits for any period of time prior to age 62, those years are excluded from being used in the calculation of the person's Social Security retirement benefit rate. In other words, the fact that a person was unable to work and as a result had little or no earnings for a period of years doesn't end up dragging down the average earnings amount used to calculate their future Social Security retirement benefit rate.

Therefore, if you became disabled at age 55, then instead of having your Social Security retirement rate calculated based on an average of your highest 35 years of earnings it will likely be based on an average of roughly your highest 28 years of earnings. That would mean excluding 7 of your lower years of earnings from being averaged in, thus resulting in higher average earnings and a relatively higher resulting benefit rate. Depending on how much you've been earning since you returned to work, your retirement benefit rate may or may not be higher than your SSDI rate, but it's not likely to be any lower.

Regarding survivor benefits, if your potential widow's rate is lower than your own benefit rate then your best strategy would likely be to start out drawing your widow's benefits at full retirement age (FRA), or sooner if your earnings would permit payment of any benefits, and then switch to your own benefits at age 70. Full benefits can be paid starting with the month that a person reaches FRA regardless of how much they are earning.

However, you'll probably only be able to collect widow's benefits if your SSDI entitlement terminates before you reach FRA. Even though your SSDI benefits have stopped being paid, unless your entitlement has terminated due to a medical improvement you would continue to be technically entitled to SSDI for at least 3 years after your trial work period ended. And, if your technical entitlement to SSDI continues up until the month you reach FRA then your benefits will automatically convert to retirement benefits at FRA. In that case you couldn't delay filing for your retirement benefits until age 70. You could still opt to suspend your benefits from FRA to age 70 in order to earn delayed retirement credits (DRC), but you couldn't then collect survivor benefits while your own benefits are suspended.

Bottom line, your best strategy depends in large part on the status of your SSDI entitlement. Social Security should be able to tell you if you are currently in an extended period of eligibility (EPE) for SSDI benefits, and if so when your EPE will end if you continue working. As long as your EPE and the resulting technical entitlement to SSDI benefits will terminate prior to FRA, you would then have the option to collect widow's benefits at FRA or earlier and wait until age 70 to file for your own benefits. If your SSDI entitlement will be terminated before you reach FRA, then you may want to strongly consider using our software (https://maximizemysocialsecurity.com/purchase) to fully analyze the options available to you in order to determine your best strategy for maximizing your benefits.

Best, Jerry