Social Security checks are essential for many American households. It does not matter if the size of your family is bigger or smaller, this money is helpful to overcome this high prices scenario. Inflation is making consumers lose their purchasing power. Not only is inflation the one that can shrink your checks, but there are also some things that can make your check reduce to zero. It does not matter if you are retired or a person with a disability, you may lose your check. SSDI, SSI, or retirement benefits allow beneficiaries to make ends meet.
That is why it is so important the way Social Security checks work so that you do not lose them or get a smaller check. Just by applying for retirement benefits early, you are making the size of your check much smaller. If you retire later than Full Retirement Age, you are increasing your benefit by 8% each year. Once you retire at the age of 70, you will have managed to save up to 24%. According to SSA, you will only get 70% of the full amount you could claim later on. This is a lot of money, and even more if inflation keeps going up. Savings may not be enough to make ends meet.
Earning too much money may reduce your Social Security check
Those who have decided to retire early, not only will they get a reduction in their checks, but they will also have income tests. Earning income while you are getting early retirement payments from Social Security benefits will become smaller. Of course, not everyone will see this reduction. It will be for those who earn over the limit. The income threshold is $21,240 in 2023. As long as you do not exceed it, you will not get less money in your check. Getting one dollar less for every 2 dollars you get is something you should avoid.
The limit becomes larger as you reach Full Retirement Age during that year. This threshold reached $56,520 and the withholding is $1 for every 3 dollars you receive, not 2. Things become even worse if you go to jail. Going to prison will mean you will lose all your Social Security checks while in jail. However, it will only be for those who are in jail for a period longer than 30 days in a row. Besides, they must have a sentence for a criminal conviction. It will not affect dependents’ or spouses on their records if they still meet the requirements.
What if you receive SSDI benefits from Social Security and go to prison?
In the same way as retirement benefits, you will lose temporarily both SSDI as well as SSI. It will be when you are in jail for more than 30 continuous days. You may get SSI back if you are in jail for less than one year. Otherwise, you would have to reapply. So, you could get SSI back a month after leaving prison. Needless to say that you will lose your SSDI benefits if you get over the illness or disease.
Once your condition improves, these checks will be over. Remember doctors will have a look at your condition regularly depending on the possibility of improvement. If you reach Full Retirement Age, you will also lose SSDI to collect retirement benefits instead. They are not compatible. Payments will be the same or very similar. Of course, you may also lose SSDI if you start working and you are able to achieve the substantial gainful activity limit.