The approval process for Social Security Disability is often tedious, long, and frustrating. It’s a great feeling when you finally get that acceptance letter in your mailbox after months of back and forth with the Social Security Administration (SSA). By all means, take a little time to enjoy the feeling! Approval offers a degree of predictability in what may otherwise be an unpredictable life for a disabled person. As you do, let’s explore a few points that will help ensure a smooth transition and look at SSDI backpay.
When will SSDI payments begin?
After your case is approved by the SSA, there are different types of disability benefits you are entitled to be paid. There is typically at least a month’s wait before your benefits will start being paid. Regular SSDI payments are made to you monthly once you have been approved. In most cases, you are also typically awarded SSDI “backpay” benefits. This is a retroactive payment of benefits and can be a large sum of money if you waited a long time for approval.
How long until I receive SSDI Backpay?
Again, it’s usually about a month until your SSDI backpay is calculated and paid. How far back is SSDI Backpay paid? You are entitled to benefits as far back as the Established Onset Date (EOD) of disability. The EOD is decided by the SSA and can be as far back as 12 months before your application date. This may be different than your application date or your Alleged Onset Date (AOD) that was initially put on your original application. The SSDI backpay award is calculated starting from five months after the EOD. You can read more about the EOD on the SSA website here.
Should you have a Social Security attorney representing you, it is very important to make sure that their payment has been taken out of the backpay award after you receive it. This is usually handled between the attorney and the Social Security Administration but mistakes do happen. There is an imposed limit where your attorney fees will never be more than 25% of your backpay award.
Receiving Your Social Security Disability Payment
Traditionally, the SSA would cut a paper check every month to benefit recipients. Phasing paper checks out has been a goal of many organizations to cut costs associated with them. The SSA offers two methods of electronic disbursement of Social Security benefits – direct deposit and a debit card.
Direct deposit is the better option of the two because you still have multiple avenues of accessing your money should you lose your bank card. You can always go make a withdrawal or write personal checks while the card is replaced. On the other hand, losing a government issued debit card cuts you off from those funds until you can get a new card.
The prepaid debit card that is loaded with benefits is an okay option if you don’t have a bank account, but direct deposit is a better option. If you are in poor standing with a banking institution from trying to survive while waiting for approval, the backpay award can be a great way to get yourself into better standing and reopen a bank account.
Ensuring Compliance with SSA Requirements
Compliance with SSA requirements is necessary to ensure that there are no interruptions in your benefits. That includes being certain that you drop below the liquid assets (cash and savings) cap before time runs out. You will likely receive a chunk of money for your back award, but you must spend it down below the $1500 level within six months or lose your benefits.
It’s a great time to catch up on bills that may have piled up while you were awaiting approval. Don’t make the mistake of blowing that award on frivolous expenses when you can lift some of the weight of debt off of your shoulders! Nowhere near as fun or exciting though, but not having that weight and stress on your shoulders from debt can be a significant quality of life improvement.