April 23, 2014

How to Coordinate Social Security Disability with Social Security Retirement Benefits

Social Security retirement and SSDIA number of my Social Security disability clients are in their late 50′s or early 60′s and they have questions about the impact of disability payments on Social Security retirement payments and vice versa.

I never felt comfortable offering advice about this issue because it falls into the area of financial planning, which is not my area of expertise.  As a Social Security disability lawyer, I focus on representing claimants who have applied for disability benefits.  Once those benefits are awarded, my representation ends, although I am happy to make referrals to professionals in other areas.

I did run across an interesting article about the disability/retirement planning issue on a web site called InvestmentNews.com, which is written for the benefit of financial advisers.  A columnist on that site, Mary Beth Franklin, publishes a regular blog called Retirement 2.0 and her June 6, 2013 column entitled How to mesh Social Security disability and retirement strategies is worth a read.

In this post, Ms. Franklin responds to a reader question about how to maximize Social Security retirement by waiting until age 70 to collect, when that individual is currently receiving Social Security retirement.  She responds that the disabled person could “suspend” disability benefits at age 66, then wait four years (without receiving any benefits) until age 70 to collect full retirement.  She also suggests that another strategy may involve having the disabled person’s spouse to file a restricted claim for spousal retirement benefits while the disabled person continue to collect disability.

More importantly Ms. Franklin points out that there are on-line Social Security calculators that allow you to run “what if” scenarios.  I found a good source for these calculators here.  I also ran a quick Google search on “social security planning adviser” and I see several companies that offer consulting services in the $250 to $350 range. If I can find out more about these vendors I’ll discuss in a future post.

My takeaway from this is as follows: there is no one size fits all solution to questions about when to take Social Security retirement if you or your spouse is currently collecting SSDI.   If you work with a CPA or financial planner, this would be a good question to pose.  If not, you may want to check out a benefits consultant or one of the online Social Security planning calculators.

It also appears that you could be leaving a lot of money on the table if you make the wrong decision for your circumstances so this is not an area where you want to guess or choose the first option you see.

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Jonathan Ginsberg represents Social Security disability claimants in Georgia. In practice for over 23 years, Jonathan publishes a widely known disability blog, a podcast and several disability web sites. In 2004, Jonathan published a "how to" book about Social Security disability called the Disability Answer Guide. Jonathan lives with his wife and 2 children in Atlanta.

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