SSD and Poverty

There has been a concerted effort in recent years to demonize people who receive Social Security Disability (SSD) benefits that provide a modest safety net when they can no longer work. Opponents of the program usually fail to mention that many SSD recipients live at or below the poverty line. Despite what is said in the media, receiving SSD benefits is not an easy way to get rich.

According to the Social Security Administration, the average monthly disabled workers benefit in November 2015 was $1,165.76, or $13,989.12 a year. Remember, this is an average, which means that some beneficiaries receive more while others receive less.

SSD Benefits Compared With Federal Poverty Amounts

Compare this with the federal poverty rate, which in 2015 was $11,770 for one person. Because many SSD recipients receive less than the average benefit amount and have no other resources, at least 30 percent of those receiving SSD benefits only are living in poverty, according to a 2014 report from the Disability Research Consortium. Moreover, for 80 percent of recipients, SSD is their primary income source. For one-third, it is their only source of income.

Consider what would happen if SSD benefits were not available at all to disabled workers. The number of people with disabilities living in poverty would more than double.

United States Disability Payments Compared With the Rest of the Developed World

Another fact to consider is how the United States compares with other industrialized countries in terms of income replacement for disabled workers. The U.S. ranks 30th out of 34 countries in the amount of income replaced by disability benefits. On average, SSD replaces only 42 percent of previous income. In contrast, some other countries replace as much as 80 percent of prior income.

Characteristics of Poor SSD Recipients

Who are the people living in poverty with only SSD benefits as income? The 2014 report from the DRC paints a picture that contrasts sharply with the idea that SSD recipients are somehow getting rich because they receive these benefits.

Characteristics of poor SSD recipients include:

  • They are younger: SSD recipients living in poverty tend to be younger. They became disabled earlier, affecting their access to education and training that could have allowed them to earn more and thus receive higher benefits after becoming disabled.
  • They are nonwhite: More poor SSD recipients tend to be nonwhite than recipients who receive higher benefit amounts. While 14 percent of poor SSD beneficiaries are white, 33 percent are nonwhite.
  • They are unmarried: Only 24 percent of poor SSD recipients are married, compared with 77 percent of beneficiaries living in higher-income households.
  • They live alone: Poor and unmarried SSD beneficiaries are much more likely to live alone or with a nonrelative, removing the family support that more prosperous but unmarried SSD recipients might receive from children, siblings and other relatives.
  • They have children: Poor SSD recipients are more likely to have children than those living above the poverty line.
  • They are in poor physical health: Although all SSD beneficiaries are disabled, poor recipients of SSD benefits are more likely to self-report their health as "poor." They are also more likely to be obese and limited in the activities of daily living.
  • They suffer from psychiatric conditions: Poor SSD-only recipients are more likely to report a mental or emotional condition as the cause of a disability than SSD-only recipients in higher-income households.

It is clear that opponents of the SSD program have not looked at statistics about recipients of disability benefits. People are not getting rich; in fact, a third of those whose only income is their disability benefit live in poverty. Compared with the rest of the developed world, the United States is stingy with its disability payments. Yet, SSD critics appear to want even more disabled people to live in poverty. Does this really reflect what Americans want?

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