Step 1: Understand the Basics of SSDI Benefits

SSDI benefits are designed to provide financial assistance to individuals who are unable to work due to a disability. The amount you are eligible for depends on your average indexed monthly earnings (AIME), which is based on your lifetime earnings as recorded by the SSA.

Step 2: Work Credits and Your Eligibility

Before calculating your benefit, the SSA first determines if you are eligible for SSDI. To qualify, you must have worked a certain number of quarters in jobs where you paid Social Security taxes. These are called work credits.

• You earn one credit for each quarter (3 months) that you work and pay Social Security taxes. The amount of earnings required to earn a credit changes each year.
• You need a minimum of 40 work credits to qualify for SSDI (typically about 10 years of work). However, if you're younger, the required number of work credits may be fewer.

Step 3: Calculate Your Average Indexed Monthly Earnings (AIME)

Once you have enough work credits, the SSA calculates your AIME, which reflects your average monthly earnings over your working years. Here’s how it works:

• Step 1: Find Your Lifetime Earnings: The SSA looks at your highest-earning years (typically 35 years of earnings) to calculate your AIME. The earnings from these years are adjusted for inflation, so older earnings are “indexed” to today’s values.
• Step 2: Divide by 420 Months: Once your highest 35 years of indexed earnings are identified, they are totaled up. This total is then divided by 420 months (the number of months in 35 years) to get your AIME.

For example, if your highest 35 years of indexed earnings total $1,050,000, your AIME would be calculated as follows:

• $1,050,000 ÷ 420 months = $2,500 per month.

Step 4: Apply the SSDI Benefit Formula

Once your AIME is calculated, the SSA uses a formula to determine your Primary Insurance Amount (PIA), which is the monthly SSDI benefit you are entitled to receive. The formula is progressive, meaning the more you earn, the higher percentage of your earnings you will receive up to a certain point.

Here’s how it works:

• The SSA applies three bend points to your AIME:
• First bend point: 90% of the first portion of your AIME (up to a certain amount).
• Second bend point: 32% of the next portion of your AIME (after the first bend point).
• Third bend point: 15% of any remaining portion of your AIME (above the second bend point).

For 2025, the SSA’s bend points are:

• $1,115 (first bend point)
• $6,721 (second bend point)
• Amounts above this second point are subject to the 15% rate.

Example Calculation:

Let’s say your AIME is $3,000:

• The first $1,115 is calculated at 90%:
  $1,115 × 90% = $1,003.50

• The next portion (from $1,115 to $3,000) is calculated at 32%:
  ($3,000 - $1,115 = $1,885)
  $1,885 × 32% = $603.20

• Since your AIME is under the second bend point of $6,721, there’s no remaining amount for the 15% calculation.

Add them together:

• $1,003.50 + $603.20 = $1,606.70
• This is your Primary Insurance Amount (PIA), or the monthly SSDI benefit you would receive.

Step 5: Adjustments and Additional Factors

While the SSDI benefit amount is based on your AIME, several factors can impact your final payment:

• Cost-of-Living Adjustments (COLA): SSDI benefits are adjusted each year for inflation through COLA. The amount you receive may change annually based on the cost of living.
• Early Retirement: If you are applying for SSDI benefits before full retirement age, your benefit may be adjusted.
• Family Benefits: In some cases, family members of the disabled worker (spouse, children, etc.) may also qualify for benefits based on the worker’s earnings record.
• Workers Compensation and Other Benefits: If you are receiving workers' compensation or other disability benefits, these could reduce your SSDI benefit.

Step 6: Use the SSA's Online Calculator

The SSA provides an online tool, the Benefit Calculator, which can help you estimate your SSDI benefits based on your earnings record. This tool uses your actual lifetime earnings to give a more accurate estimate.

You can access the SSA’s Benefit Calculator at www.ssa.gov/benefits/.