Supplements to Social Security Retirement

How low can you go? When it comes to monthly Social Security Retirement (SSR) payments, the answer is very low. Some people earn less than $861 a month in Social Security benefits despite working large portions of their lives. Others have not worked for enough time to receive any SSR benefits. Are you one of these individuals? Do you need additional financial assistance? If so, then continue reading this article. This article is meant to discuss some of the ways individuals with low or no SSR can supplement their income.

Social Security Retirement can be a bit tricky. For one, it isn’t automatic. To qualify for Social Security Retirement at all, you need to work and earn income paying taxes into social security for 10 years. So, if your work history was sporadic or nonexistent, or in a job where taxes weren’t paid to social security, you might not qualify for Social Security Retirement. Additionally, Social Security computes monthly retirement benefits on a sliding scale where your monthly retirement benefit increases based on the length of time you worked and your earnings history. This means someone who worked a six-figure job will get a higher monthly retirement benefit than someone who worked for minimum wage. The unfortunate effect of this system is that many individuals are left with little to no retirement benefits. 

Luckily, the Social Security Administration created the Supplemental Security Income (SSI) program for folks who get low or no Social Security Retirement benefits. You might have heard of SSI as a disability program for younger folks unable to work and that is a lengthy process that requires proving a disability. However, SSI also provides individuals 65 or older with unearned income of less than $861 a month and less than $2,000 in assets ($3,000 in assets if married) with a pathway to receive a total of $861 a month. Moreover, if 65 or over, the Social Security Administration waives the normal requirement of proving a disability to get on the SSI program. You just must apply for the program and prove your limited income and assets as specified above.

That is great news for individuals with little or no retirement benefits. Even better news is that the State of Colorado also offers the Old Age Pension (OAP) for folks who are over 60, receive less than $899 in unearned income, and have less than $2,000 in assets ($3,000 in assets if married). The OAP was created during the great depression to help low-income older adults who needed income. To qualify for the OAP, you must first apply for SSI. However, if you apply for SSI and then apply for the OAP, you can receive additional income on top of your SSI benefits for a total of $899 a month. 

You might be wondering why the benefits aren’t larger. The simple answer is that both SSI and the OAP are needs-based programs and therefore deduct unearned or earned income received from your total benefit amount. For unearned income, any unearned income you receive on either program that is more than $20 a month is deducted from your total benefit amount on a dollar per dollar basis. In practical terms, this means that someone who applies for SSI, then applies for OAP, would get their SSI income, then get their OAP income minus the amount they receive from SSI, other than the first $20 of their SSI benefit. This results in the benefits largely cancelling each other out.

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