Retirement vs. Social Security Disability Insurance

Posted June 20, 2017 by Premier Disability Services, LLC®

retired couple

Many people are not aware of the difference between Social Security Retirement and Social Security Disability Insurance benefits. Most American workers pay into Social Security during their working years. When they pay their taxes, they are actually paying in to both the retirement and disability insurance programs. When people say they are collecting “Social Security”, they are usually referring to retirement through Social Security. However, Social Security can pay workers benefits if they become disabled before their full retirement age.

Retirement Benefits

When a worker decides to collect their retirement benefit under Social Security, they can choose when they want to begin collecting their benefits. There are qualifications that must be met in order to begin receiving these benefits:


  1. The claimant must have 40 lifetime “working credits” in order to collect benefits. This equates to at least 10 years of full time employment, as workers may be awarded 4 credits per year.
  2. The claimant must be at least 62 years of age (or 60 if they are collecting on a disabled or deceased spouse’s record).


The retirement benefit amount depends on how much the claimant earned during the years that they worked. If they choose to collect their retirement before their full retirement age under Social Security’s guidelines, they will get a lower benefit amount. Full retirement age under Social Security varies by year of birth. For instance, for someone that was born in 1957, full retirement age is 66 and 6 months. If the claimant chooses to collect early retirement immediately upon turning 62, the benefit would be approximately 25% lower than if they chose to wait until their full retirement age. The penalty deduction is greater the earlier the retirement is elected.

Disability Insurance Benefits

Social Security can also pay benefits to workers that become disabled and can no longer work. These benefits generally pay the worker the full amount that they would receive if they were at full retirement age. Unlike temporary or partial disability programs that a worker can be eligible for through their employer or state, Social Security will only pay benefits to someone that they find permanently and totally disabled under their rules. There are qualifications that must be met in order to receive disability insurance benefits:


  1. The claimant must have 20 working credits within the last 10 years before their disability began. This means the applicant must have paid into Social Security at least 5 of the last 10 years before they became disabled.
  2. The claimant must be found disabled by Social Security.


Social Security uses a 5-step sequential process to determine whether or not a claimant is disabled:


  1. Is the claimant working? If they are, their earnings cannot exceed a certain amount each month.
  2. Are the conditions severe? The conditions have to keep the claimant from performing their job for over 12 months.
  3. Do the condition(s) meet or equal any listings under Social Security? Social Security has a list of conditions they consider severe enough to keep a claimant from performing their job duties. Social Security reviews certain medical conditions to determine disability.
  4. Can the claimant perform the work duties of their previous employment? Social Security looks at a claimant’s previous employment to see if they are able to perform any of those jobs. If they feel they cannot perform any of their previous jobs, they may find them disabled.
  5. Can the claimant perform any other type of work? Social Security will look at other jobs that the claimant may be able to do in the present economy. They will use previous work experience, education, and age to determine this. If they feel that the claimant can perform other work, they may not find them disabled.


A claimant may collect early retirement benefits while they have a disability claim pending with Social Security. If the claimant is then found disabled, their benefit amount will be adjusted, and they will receive their full benefit amount. If, however, they are not found disabled, their benefits will be frozen at the amount they were receiving when they first began receiving these benefits.

To find out what your retirement benefits will be, you can go to

Source: pub. No. 05-10029, pub. No. 05-10035

By: Peggy Taylor of Premier Disability Services, LLC®