When American workers become unable to work for a living due to injury or illness, they may be able to rely on the Social Security Disability Insurance program to provide them benefits. These benefits can provide them with income at a time when they badly need it.
How much can a disabled worker expect in benefits? The answer is not simple.
The first thing to remember in this conversation is that Social Security Disability works like an insurance system. You must pay into the system before you can collect benefits. Workers pay into the system through taxes paid on their salaries. For this reason, people who become disabled before they are able to work for a living may be disqualified from receiving benefits.
As with Social Security retirement benefits, the agency uses a complex formula to calculate the dollar amount of disability benefits based on the worker’s salary history. For retirement benefits, the SSA starts by taking the average yearly income of the 35 highest-earning years of the person’s working life, up to a certain cap. The cap in 2021 is $142,800, so the average will not top that number. But, because disability benefits are meant for people who become disabled before they reach retirement age, the agency must calculate the average over a shorter time period.
The average depends upon how long the person has been working before they became disabled. The SSA counts the number of years since age 22 the person worked and then throws out between one and five years. (The number of these “dropout” years depends on how long the person worked. People who became disabled at a young age may have one year tossed out. People who worked much longer may have five years tossed out.) With this formula, the period would be 23 years for a person who had worked since they were 21 and became disabled at age 50. The amount of the disability benefits is based on the average salary during those years.