Why is my SSDI payment lower than others with less work history?

Recently on our disability forum a user asked, “I have friends whose Social Security Disability Insurance (SSDI) payment is twice as high as mine. I am wondering how that is possible if I have more work history than they do?” 

What is SSDI?

Claimants who have a severe health condition that does not allow them to work for at least 12 continuous months may qualify for SSDI benefits if they have worked and paid sufficient taxes to be considered insured for benefits. Claimants who have not worked or who have not paid enough in taxes will not qualify for benefits regardless of the severity of their health condition.

How is my SSDI benefit calculated?

Now, you mentioned that your friends had less work history than you but were making more in SSDI payments. As mentioned above, they will only qualify for SSDI benefits if they have worked and earned enough work credits. To earn one work credit in 2016 a claimant must earn $1,260. You can earn a maximum of four credits per year.

The amount of work your friends would have had to perform to earn their work credits would vary based on their income. For example, if their income was much higher than yours not only would they not have to work as many hours to accumulate work credits, but they would be paying more in Social Security taxes for each hour worked.

So without more information about the income of all parties and the taxes paid it’s likely that your friend’s income was higher than yours, they paid more in taxes, accumulated work credits more quickly and had a higher average income- thus leading to a higher SSDI payout when they were determined disabled.

Talk to the SSA about your benefit payment

Another step you might want to take is to verify with the SSA that your SSDI payment has been calculated correctly. For example, if the SSA did not have all of your work history and incorrectly calculated the taxes paid your SSDI payment might be too low.

Unfortunately, the SSDI payment calculation is so complicated that it’s really tough for the average person not well-versed in SSA regulations and policies to really understand how the SSA calculates the SSDI payment amount.

If you doubt this is true review the information provided by the SSA about how they calculate your SSDI payments:

Your SSDI benefits are based on the amount of income on which you have paid social security taxes. Your average earnings are called your Average Indexed Monthly Earnings (AIME). Using your AIME, the SSA will calculate your Primary Insurance Amount (PIA). As of 2014, the PIA is calculated by taking 90% of AIME under $816, 32% of AIME between $816 and $4917, and 15% of AIME greater than $4917. The final PIA amount is the maximum amount of SSDI benefits that you are entitled to receive. 

How can I increase my SSDI payment?

Unfortunately, after you have become disabled and you are receiving SSDI benefits there is no way to increase your SSDI payment. It will not matter if you become more disabled, if your spouse makes less money, or if any other factor changes.

Given the method the SSA uses to determine your SSDI payment this calculation is finalized once you stop working. The SSA also does not give partial SSDI benefits so you are either disabled or you are not. They do not assign any type of disability rating or increase benefits as you become more disabled.

Bottom Line:

To really understand why your friend’s payments are higher than yours you would have to have more information about everyone’s averaged indexed monthly earnings and review the SSDI calculations used by the SSA.