A reader has a question about the suitability of switching from Social Security disability benefits to Social Security retirement benefits.
I was awarded Social Security disability prior to age 62. I and am now age 62 and am entitled to Social Security retirement benefits simultaneously with disability benefits.
Also, I have three minor children currently receiving auxiliary benefits on my DIB.
I am interested in applying for Social Security retirement benefits since it may yield me an overall larger family-benefit (even if my personal-benefit (reduced-RIB) will be smaller than DIB).
I specifically am interested in how my Social Security Retirement Primary Insurance Amount (PIA) may be calculated relatively (from how my Disability-PIA was previously calculated).
My Questions, please:
Will my RIB–PIA be calculated, like my DIB-PIA was, using the:
- “freeze” (excluded the 4-years of my disability prior to my disability onset date and used only 31 of the usual 35-yrs) or will it calculate my RIB-PIA using the usual 35-yrs?
- the national average wage index (NAWI) factor previously used to calc my DIB (2-yrs prior to my disability onset date) or will it calculate my RIB-PIA using my new age-60 NAWI?
Thank you for helping me.
First, let me clear up something that I think is crucial. You CANNOT receive both disability benefits and retirement benefits. When the Social Security Administration references “simultaneous,” they are talking about being entitled to both-but not at the same time.
Once you attain full retirement age, your Social Security Disability benefit will automatically convert to a retirement benefit with no change in benefit amount (or action required on your part).
I can’t think of any reason why you would want to switch from a disability benefit to a retirement benefit before your full retirement age. Remember that your disability amount is the same as your full retirement age benefit. There is no reduction for early disability benefits. That is not the case for retirement benefits. If you switch from disability benefits to retirement benefits, your payment amount would go down!
Lastly, your primary insurance amount (PIA) is set. The Administration will not recalculate your PIA prior to your benefit converting to retirement benefits.
I hope this answers your questions!
A note for all readers.
Over the past few years, I’ve found that most Social Security questions can be answered with an understanding of just six simple Social Security basics. I cover these basics in a 100% free report that you can download by clicking HERE.
If you still have questions after reading this report, send me an email. I can’t promise that I’ll respond individually, but I love interacting with my readers and answering Social Security questions! The questions and answers that’ll have priority are those that may benefit a wider audience. I’ll answer the question individually and then publish the Q&A on my blog. (Don’t worry, I’ll change up enough personal details so you’ll stay unknown.)
If you want to make sure I answer your question, I am still accepting individual consultations. You can click HERE for more information on booking a call with me.
Thanks for reading!