Will My Disability Benefits Change When I Turn 65?

For the 7.3 million Americans receiving disability benefits through the Social Security Disability Insurance (SSDI) program, turning 65 is a significant milestone. 

Many seniors question how their benefits may change as they approach retirement age. Will their disability benefits automatically convert to retirement benefits? Will the amount they receive each month change? What about Medicare and Medicaid?

If you’re among the many people wondering what will happen to your disability benefits when you reach this milestone, you’re not alone. 

In this guide, we’ll cover the differences between Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI), benefit changes at 65, how pensions and spousal benefits can impact payments, and the connection between disability benefits and Medicare/Medicaid. 

Whether you’re receiving disability benefits or planning for retirement, this site provides the information you need to make informed decisions about your future.

Understanding Disability Benefits

Before we dive into how disability benefits change when you turn 65, we must understand the two primary disability benefit programs: Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI).

Social Security Disability Insurance (SSDI)

SSDI is a federal insurance program that provides benefits to people with disabilities who have worked and paid into the Social Security system. To qualify for SSDI, you must:

• Have a medical condition that meets Social Security’s definition of a disability.
• Have earned enough work credits through your employment history.

The amount you receive in SSDI benefits is based on your average lifetime earnings before your disability began. In 2024, the average monthly SSDI benefit is $1,537.

Supplemental Security Income (SSI)

SSI is a needs-based program that provides financial assistance to people with disabilities who have limited income and resources. SSDI is different from SSDI, you do not need a work history to qualify for SSI. To be eligible, you must:

• Have a medical condition that meets Social Security’s definition of a disability.
• Have limited income and resources.

In 2024, an individual’s maximum monthly SSI benefit is $943.

Key Differences Between SSDI and SSI

While both programs provide financial assistance to people with disabilities, there are some key differences between SSDI and SSI:

• SSDI is based on your work history, while SSI is based on financial need.
• SSDI benefits are typically higher than SSI benefits.
• SSDI recipients are automatically enrolled in Medicare after a 24-month waiting period, while SSI recipients are generally eligible for Medicaid.

Understanding these differences is crucial to navigating the changes to disability benefits when you turn 65.

Transitioning from Disability to Retirement Benefits

Now that you have a clear understanding of SSDI and SSI let’s explore what happens to your disability benefits when you reach age 65.

Automatic Conversion to Retirement Benefits

Disability benefits do not automatically convert to retirement benefits at age 65; the conversion happens when you reach your full retirement age (FRA), which varies depending on your birth year.

For people born in 1960 or later, the full retirement age is 67, not 65. 

When you reach your full retirement age, your Social Security Disability Insurance (SSDI) benefits automatically convert to retirement benefits. This is an administrative change; you don’t need to do anything.

The amount of your benefit typically remains the same after this conversion. Your disability benefit amount becomes your retirement benefit amount. You cannot receive both disability and retirement benefits on the same earnings record simultaneously.

This conversion applies to both the disabled worker’s benefits and any spousal benefits based on the disabled worker’s record. After the conversion, you’re no longer subject to continuing disability reviews, as your eligibility is no longer based on disability status.

It’s important to note that while the benefit amount usually stays the same, individual circumstances can vary. If you have any concerns about your specific situation, it’s best to contact the Social Security Administration directly or consult with a benefits specialist.

Changes in Benefit Amounts

If you start receiving retirement benefits before your full retirement age, your benefit amount will be reduced. On the other hand, if you receive retirement benefits past your full retirement age, your benefit amount will stay the same.

If you receive SSI benefits, your eligibility and benefit amount may change when you turn 65 and become eligible for retirement benefits. SSI is a needs-based program, and your retirement income will be considered when determining your eligibility and benefit amount.

Factors That May Affect Your Transition

Several factors can impact your transition from disability to retirement benefits:

• Pensions: If you receive a pension from a job where you did not pay Social Security taxes, your disability benefit may be reduced. This reduction is known as the Windfall Elimination Provision (WEP).
• Spousal Benefits: If you receive disability benefits based on your spouse’s work record, your benefit amount may change when you turn 65. In some cases, you may be eligible for a higher benefit based on your work record.
• Medicare and Disability: If you receive SSDI benefits, you will automatically be enrolled in Medicare after a 24-month waiting period. When you turn 65, you can enroll in additional Medicare coverage, such as Part B (medical insurance) and Part D (prescription drug coverage).
• Medicaid and Disability: If you receive SSI benefits, you may also be eligible for Medicaid. When you turn 65, your Medicaid eligibility may change based on your income and assets. It’s important to contact your local Medicaid office to understand how your coverage may be affected.

How Long Does Disability Last?

Social Security Disability Insurance (SSDI) benefits can last as long as you remain disabled and unable to engage in substantial gainful activity (SGA). When you reach full retirement age, SSDI benefits automatically convert to Social Security retirement benefits. 

The SSA conducts periodic reviews to determine if you still qualify as disabled. Benefits may end if your medical condition improves or you return to work and earn above the SGA threshold. Unlike SSDI, SSI benefits do not automatically convert at retirement age and continue as long as the financial and disability requirements are met. 

However, certain situations, such as incarceration for 30 days or more, can result in the suspension or termination of benefits.

Navigating the Intersection of SSDI, SSI, Medicare, and Medicaid

The relationship between disability benefits and healthcare can be complex, especially when you turn 65. In some cases, you may be eligible for Medicare and Medicaid as a “dual eligible” beneficiary.

If you find yourself in this situation, it’s essential to understand how your benefits work together and what options are available to you. Consider working with a benefits counselor or a local aging agency to help you navigate this process.

Transitioning from Disability to Retirement

Turning 65 is a significant milestone for those receiving disability benefits. While the transition from disability to retirement benefits can seem daunting, understanding the process and knowing what to expect can help you confidently navigate this change.

Remember, your disability benefits will automatically convert to retirement benefits when you reach your full retirement age. The amount you receive may change depending on factors like pensions and spousal benefits, and your healthcare coverage through Medicare and Medicaid may also be impacted.

If you have questions or concerns about your situation, don’t hesitate to contact the Social Security Administration, local aging agency, or a benefits counselor. They can provide personalized guidance and help you make informed decisions about your benefits and healthcare coverage.

Embrace this new chapter in your life, and know that with the right information and support, you can confidently transition from disability to retirement benefits.