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Unemployment Rate for People with Disabilities Continues to Rise, Part Two

Earlier this week, we talked about the record numbers of unemployed Americans with disabilities, and the concurrent increase in applications for Social Security Disability Insurance.

It was recently reported that the average wait time for a SSDI claim is over two years, with 1.8 million people currently on the waiting list. According to industry experts, even when an SSDI claim is finally processed and approved, individuals need to understand, and be prepared for, the high likelihood that they will not receive benefits that are equal to their previous income. "They need to plan financially for what likely will be a significantly reduced income," said Paul Gada of Allsup Disability Life Planning Center.

SSDI benefits are determined by an applicant's earnings history, and therefore can vary widely based on age and gender. In September 2010, the average monthly benefit was just over $1,000. However, the average among men was almost $2,000, while women averaged just $929 per month. In addition, 30-year-old applicants generally receive an average $750 monthly benefit, while 60-year-olds average just over $1,200 in monthly benefits received.

The spouse and dependents of a disabled individual may also be eligible for social security disability benefits. There are specific eligibility requirements: the receiving spouse must be at least 62 years old, or must have a child under 16 or who has a disability. The amount of such benefits also varies widely, but in September, the average monthly benefit to a dependent child was $318.

While these amounts are already low, SSDI recipients were recently dealt another blow when the Social Security Administration announced that, for the second consecutive year, there will not be a benefit adjustment based on a cost of living analysis, or COLA. We have discussed this hindrance, as well as potential solutions currently being considered by legislators, in an earlier blog post.

Source: San Francisco Chronicle, "Income at Risk: Quarterly Unemployment Rate for People with Disabilities Climbs along with SSDI Claims, Reports Allsup", 26 October 2010

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