What's The Difference Between SSDI, SSDI & Unemployment?

When you are unable to work and need financial assistance what government program do you go to for help? Many people do not have an accurate understanding of the distinctions between Social Security Disability Insurance (SSDI), Supplemental Security Income (SSI), and Unemployment Insurance (UI) programs. This guide will help provide an overview of each program, discuss how they differ, and help you choose the program appropriate for your situation.

Overview of Social Security Disability Insurance (SSDI)

Social Security Disability Insurance provides benefits to people who have developed a disability or who are blind and who are “insured” by workers’ contributions to the Social Security trust fund. These contributions are based on your earnings (or those of your spouse or parents) as required by FICA. Your dependents may also be eligible for benefits from your earnings record.

The FICA (Federal Insurance Contributions Act), passed as part of the Social Security Act in 1935, requires both workers and employers to pay payroll taxes that support Social Security and Medicare benefits. This ensures the backing for these programs through a wage tax.

Employers and employees share the burden of FICA taxes at a combined rate of 15.3% of gross wages. Out of this total, 12.4% is dedicated to Social Security and the remaining percentage goes towards funding Medicare.

Source of Payments: Social Security’s Disability Insurance Trust Fund

Eligibility Requirements: to be eligible for SSDI, you must

Have a qualified disability that affects your ability to work for a year or more or will result in death.
Have worked in substantial gainful activity for at least 5 of the last 10 years.

Benefits: Your benefits include a monthly payment based on your work history and lifetime average earnings covered by Social Security before your disability began. Applicants are required to complete a waiting period for disability benefits before payments begin. After receiving SSDI benefits for two years, workers can receive Medicare coverage.

How to Apply for SSDI Benefits:

You can submit your application for SSDI benefits online or over the phone by calling 1-800-772-1213.

The Social Security Administration (SSA) will go through your application, work history, and medical and other records. If you meet the non-medical criteria, they will pass along your case to your state’s Disability Determination Service (DDS). The DDSs, fully funded by the Federal Government, are State agencies responsible for developing medical evidence and determining whether or not a claimant is disabled or blind under the law.

The SSDI application process can typically last 3 – 6 months for evaluating all submitted documents. You have the option to sign in to your Social Security account to check the status of your disability application and get an idea of the estimated timeframe for processing your request.

Once the Social Security Administration competes the assessment of your application, they will send you a letter informing you of approval or denial.

Overview of Supplemental Security Income (SSI)

The Supplemental Security Income program is managed by the SSA and provides payments to adults and children with limited income and resources who are blind or have a disability. SSI payments are also available for adults 65 or older without disabilities who meet SSI’s financial qualifications.

Source of Payments: General tax revenues

Eligibility Requirements: To be eligible for SSI, you must:

Be age 65 or older or have blindness or a disability that affects your ability to work for more than one year or will result in death
Have “countable income” below the maximum federal benefit rate (FBR.) In 2024, the maximum FBR is $943 a month for an individual and $1,415 for a couple when both are eligible for SSI.
Have financial assets (excluding your home and your car) that do not exceed $2,000 for an individual and $3,000 for a couple.
Be a U.S. citizen or national, or a noncitizen in an “alien classification” granted by the Department of Homeland Security (DHS.)
You must be a resident of one of the fifty states, DC, or Northern Mariana Islands. (Residents of American Samoa, Guam, Puerto Rico, or U.S. Virgin Islands are ineligible for SSI.)

Benefits: Your benefits include a monthly payment, which depends on your income, living situation, things you own, and other factors. Your monthly payment varies up to the maximum Federal Benefit Rate or FBR. The maximum Federal SSI benefit amount may change each year. SSI benefits did increase in 2024 because of an increase in the Consumer Price Index from the third quarter of 2022 to the third quarter of 2023. As of January 1, 2024, the Federal benefit rate is $943 for individuals and $1,415 for couples.

Additionally, most beneficiaries will automatically be eligible for Medicaid coverage. In many states, people who receive SSI can receive an additional amount called a “state supplement”. The amounts and qualifications for these state supplements vary from state to state.

SSI Application Process:

The application process for SSI is similar to the process for SSDI. However, you cannot apply online unless you are applying for SSDI and SSI simultaneously.

Overview of Unemployment Benefits / Insurance (UI)

Unemployment Insurance is a state program that pays you money if you lose your job through no fault of your own.

Source of Payments: State FICA Tax Revenues

Eligibility Requirements: Each state determines the eligibility requirements for UI. Generally, most states require that you:

Have earned a specific amount within the last 12 to 24 months.
Worked consistently for the last 12 to 24 months.
Actively look for a new job.

Benefit Amount: How much can individuals expect from state unemployment insurance is dependent upon their past wage earnings.

Unemployment Benefits Application Process:

Each state administers their own Unemployment insurance program, so you will need to apply for UI benefits on the website for the state you worked in. you can learn more about eligibility requirements and how to apply by selecting your state on this map.

Key Differences Between SSDI, SSI, and UI

Differences in the Purpose of the Program:

SSDI is long-term assistance for disabled workers, or their spouses and children, whose disability is expected to last more than 12 months or prove fatal.
SSI is assistance for an indefinite time for individuals who are elderly or disabled and experiencing financial hardship.
Unemployment benefits are short term financial assistance for people who have lost jobs and are seeking a new job.

Differences in Eligibility

SSDI is based on your work history and disability. You must be “insured” based on contributions made to FICA from your own wages, or those of your spouse or your parents.
SSI is based on your financial need and age or disability.
Unemployment benefits are dependent on your work history and evidence that you are actively seeking employment.

Differences in Income Thresholds:

SSDI does not impose any income limits apart from you’re the earnings you make from work.
SSI imposes restrictions on both income and assets.
Unemployment assistance is determined by your wages over the past 12-24 months.

Is it Possible to Receive Benefits from SSDI, SSI, and UI at the Same Time?

You may be able to get SSDI benefits and SSI payments if you meet the criteria for both programs. However, if you receive SSDI benefits, it could lower the amount of SSI payments you receive or render you ineligible. Since both SSDI and SSI hinge on the inability to work, you would not qualify for unemployment benefits.

Selecting the Appropriate Benefit Program

All three government programs assist those facing unemployment or health issues that hinder their ability to work. The selection of the appropriate program hinges on one’s specific circumstances.

Typically speaking, people need to be incapable of working due to a recognized disability to qualify for disability benefits like SSDI or SSI from the government. Disability status is established through an assessment and documentation of the person’s mental and physical health by an authorized healthcare provider. On the other hand, unemployment benefits are accessible when someone has lost their job and is actively looking for a new employment opportunity. To be eligible for unemployment benefits, individuals must show that they haven’t caused their job loss and are actively seeking employment opportunities.

The main considerations, in selecting a program involve your ability to work, the circumstances leading to your job loss or inability to work, and the eligibility criteria involved in each case. Obtaining unemployment benefits typically follows a clear process whereas securing disability benefits can be intricate and might necessitate the guidance of a disability lawyer.

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