Kotlikoff: Can I return to work and still receive Social Security disability benefits?

Boston University economist Laurence Kotlikoff writes a regular column answering questions about your Social Security benefits.

Jeanne: I am afraid you get thousands of emails, but I have received different answers from every person, agency and government office I spoke with regarding my retirement options. I am hoping you can shed some light on my situation.

I was married for more than 10 years to my ex-husband. He is 69 and receives retirement benefits (approximately $2,000 per month). I have been on disability ($761 per month) since 2010 and will turn 62 in January 2016.

My physical disabilities persist, but I am hoping to work soon. It appears that I may be jeopardizing future Social Security benefits by going back to work. Here are my questions:

  • Can I collect on my former spouse, or should I wait until full retirement age?
  • Do I have to keep Medicare if I get group coverage through work?
  • Should I only work part time?
  • How would all this be affected if I remarry?

I raised six children and put them through college, so I no longer have any savings or property. I had prolonged health issues (not the original disability) and although those issues have been completely resolved, I’ve fallen into deep poverty and have had to use many government programs (Section 8, food stamps, Medicaid pays for Medicare and Vocational Rehab). I hate this existence and was hoping to earn enough to regain independence and improve my situation. Will I just be making things worse when I must retire?

Any advice would be sincerely appreciated.

Larry Kotlikoff: If your ex dies, your optimal strategy will change, but for now, my guess is that you should try to earn as much money as possible right through age 70 and start your ​benefits either at full retirement age or at 70. You missed the ability to collect a full spousal benefit at full retirement age and wait until 70 to collect your possibly higher benefit by just one month.

If you earn enough money, you will lose all your disability benefits via the earnings test, but it will likely be worth it in terms of your lifetime income. If you go off of disability, you can simply wait until 70 to take your retirement benefit if that’s optimal. It may not be!

Yours is a pretty complex case. I’ve asked former Social Security technical expert Jerry Lutz for his input.

Read more: PBS

Laurence Kotlikoff Laurence Kotlikoff’s state-of-the-art retirement software is available here, for free, in its “basic” version. His new book, “Get What’s Yours—the Secrets to Maxing Out Your Social Security Benefits,” (co-authored with Paul Solman and Making Sen$e Medicare columnist Phil Moeller) was published in February by Simon & Schuster. Find a complete list of Kotlikoff’s columns here.


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