Are Social Security and SSDI the Same Thing?

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The Social Security and Social Security Disability Insurance (SSDI) programs are both managed by the Social Security Administration (SSA) and provide benefits to those who are unable to work, but each program has a different purpose and unique eligibility requirements.

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Social Security benefits replace a percentage of a worker’s income based on lifetime earnings. It also provides survivor benefits and income for those who become disabled. A person’s Social Security retirement benefit amount depends on lifetime earnings and when they choose to start receiving benefits. Benefits are financed through a dedicated payroll tax. Employers and employees each pay half while self-employed workers pay the entire 12.4%.

SSDI is also earned based on work earnings and funded through payroll taxes, but with the sole purpose of providing benefits to those who can no longer work due to a severe disability (and to their dependents). To qualify for SSDI, the SSA says that you must meet the definition of disability under the Social Security Act.

A person is considered disabled if they can’t work due to a severe medical condition that has lasted (or is expected to last) at least one year or result in death. The condition must also prevent them from doing work they did in the past, or from adjusting to new work. According to the SSA, SSDI recipients are typically among the most severely impaired in the country.

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Similarly to Social Security benefits, SSDI only covers a portion of your income. Benefits barely keep beneficiaries above the federal poverty level. The SSA says that for most SSDI beneficiaries, monthly disability payments represent a majority of their income but can still make a big difference in terms of allowing beneficiaries to meet their most basic needs.

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About the Author

Josephine Nesbit is a freelance writer specializing in real estate and personal finance. She grew up in New England but is now based out of Ohio where she attended The Ohio State University and lives with her two toddlers and fiancé. Her work has appeared in print and online publications such as Fox Business and Scotsman Guide.
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