What’s the Difference Between SSI and SSDI?

As elder law and estate planning attorneys, we often have to explain details about government benefit programs to our clients. There are some programs that serve related purposes that have similar sounding names so there can be some confusion. This is certainly true of Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI).

Need-Based Benefit

Supplemental Security Income is a program that provides monthly income to qualified people with disabilities who have very limited financial resources. In 2019, the maximum SSI monthly benefit is $771 for an individual. That’s not a lot, but it certainly helps.

People who are eligible for Supplemental Security Income automatically qualify for Medicaid as a source of health care insurance. If you have a loved one with special needs on your inheritance list who is relying on these programs, you have to tread lightly. A significant windfall of resources could cause a loss of benefits.

Under these circumstances, you could establish and fund a third-party supplemental needs trust. The trustee named in the document would be empowered to use assets in the trust to purchase certain goods and services for the beneficiary without impacting benefit eligibility.

Medicaid is required to seek reimbursement from the estates of certain people who used the program while they were alive. This is called Medicaid estate recovery, but assets that remain in a third-party supplemental needs trust would be protected during these efforts. After the death of your beneficiary, the resources would be transferred to a successor beneficiary that you name when you establish the trust.

Social Security Contributions

A person can qualify for SSI without ever working for even a single day, and many people with disabilities simply cannot do so. On the other hand, you qualify for Social Security Disability Insurance by paying into the Social Security program through the FICA or self-employment tax contributions that come out of your earnings.

Because of this, if you can prove that you are unable to work due to a disability, you can potentially qualify for SSDI without regard to the extent of your assets. The exact amount of the benefit you receive will be calculated based on the amount of the taxable earnings you received while you were working.

Currently, the maximum monthly SSDI benefit is $2788 for an individual recipient, and the average is $1197.

Attend a Free Seminar

We provided a bit of basic information about one important subject in this brief blog post. If you would like to sit in on a comprehensive information session, there are some great opportunities coming up in the near future.

The attorneys from our firm are holding a series of seminars, and there is a great deal of important information conveyed at these gatherings, but it is done in a concise manner. We consistently hear very positive feedback from attendees, and this is gratifying.

There is no admission charge, but we ask that you register in advance so that we can reserve your seat. Visit our seminar schedule page to see the dates, click on the one that works for you, and follow the simple instructions to register.

Schedule a Consultation!

It is great to educate yourself, but at some point, you will likely come to the conclusion that you should sit down and discuss your estate planning goals with a licensed attorney. If that time is now, we are here for you. You can send us a message to request a consultation appointment, and we can be reached by phone at 606-324-5516 in Ashland, Kentucky, or 859-372-6655 in Florence, KY, and our North Carolina number is 704-944-3245 (Charlotte, NC and Huntersville, NC).