Graduate students and paying into Social Security (disability related question)
![[Post New]](/jforum/templates/default/images/icon_minipost_new.gif){kind=icon}
Anonymous
|
My adult child has worked for 2 years as a post bac and was paid a stipend, not a salary.
According to the IRS, you do not pay into FICA with a stipend, so the past two years didn't count towards earning any credits for SSDI or SS. They are now going to enter a 5 year PhD program, also earning a stipend. They will be paying federal and state taxes on the stipend, but not paying into Social Security. Thus not earning any credits per year towards a Social Security benefit. I am not terribly concerned about disability, but we have had family members become suddenly disabled at young ages, who have needed the financial support of SSDI and private disability insurance policies. I know that if my adult child becomes disabled at, say, age 27, the rules to qualify for SSDI say they need to have worked at least half the time between ages 27 and age 21 in order to qualify for SSDI (which brings along the possibility of Medicare coverage if needed). This is the way our country's safety net works. Am I being overly worried about this issue? I feel 7 years in your 20s is too long to go without paying into Social Security. I want to encourage them to earn at least $8000 each year in SS covered employment somehow (even though officially, grad school rules say no outside employment.) That's only about $200 each week and maybe could be earned by tutoring, or by working in the summer? I have no experience with grad school PHD life so I don't know if this is possible. But I think it is important to keep access to what is our country's only safety net. There's such a thing as private disability insurance, but it replaces a salary, and a stipend isn't a salary. |
Anonymous
|
I think you're being prudent. But statistically the risk is usually low for people in their 20s. And I think it's hard to qualify for SSDI.
When I briefly had no health insurance for me and my husband, I increased our car insurance coverage. That was my logical response to similar worries. Tutoring or freelancing is a good idea. But then they have to pay the employer's share. |
Anonymous
It is rare, but we have kidney failure/transplant in the family unfortunately, and it hit early, as well as another illness that automatically qualifies people for SSDI. Not 20s but still... it's definitely on my mind. |
Anonymous
Then it's realistic for your family. I remember being proud when I got my 40 credits. I knew someone whose underage siblings were partly supported by the survivor's benefit. It's important to have safety nets. |
Anonymous
|
Yes - and I know someone who was permanently disabled at age 23, and didn't have enough work credits to qualify for SSDI, so only SSI which is a lower amount.
Although I suppose her SSDI income wouldn't have been much higher at age 23. But with SSDI, there are no asset limitations. With SSI you aren't allowed to have assets. |
Anonymous
| You could consider disability insurance rather than breaking the program rules and putting your daughter’s education at risk. |
Anonymous
They can request to be allowed to work from their program advisor, and up to 10 hours weekly might be approved. Tutoring, say, advanced math or physics 4 hours weekly would not be a problem. And private disability insurance policies generally require you to be working full time; graduate students technically aren't "working", that's why they aren't "paid". Instead of a salary, they get a stipend (which doesn't count as income, which is why they don't contribute to Social Security or Medicare or unemployment.) |
Anonymous
| Do you have a lot of money? Hire them during vacations to do somethimg and pay them enough to get their quarters. |
Anonymous
No not at all - my spouse is on SSDI. |
Anonymous
Summer job sounds like a good solution. |
Anonymous
No school is going yo kick her out for finding put she made 10, 000 a tear. It's an absurd rule that does not consider how vulnerable it's rendering young adults. Op tell her to work and keep her mouth shut. She will not get caught. If she dies, she can say sorry and explain as you have. They will not kick her out. |
Anonymous
^ sorry, does not dies. |
Anonymous
|
As a former grad student I think it's easier to make 8000 taxable income in the summer than part time during the year. At a university it's hard to charge premium tutoring rates because there tend to be on campus services that pay lower hourly wages, or worse, make it part of a stipend work requirement (instead of TAing or something).
It's definitely not impossible to work part time outside school, I did it and so did my friends with medical bills, but the money just doesn't add up very fast. Summers are better because you have larger blocks and can do more specialized and higher earning work. But only if your program doesn't expect you to be doing (funded) lab work all summer. That said, I'm not sure I'd have your kid plan their life around earning SS credits in their 20s. |
Anonymous
| What is the difference between being disabled and never working (and collecting benefits) and becoming disabled and collecting benefits? Sorry, I don’t know anything about this sort of thing. Why are they different? |
Anonymous
If you have never worked, or you have not worked enough to qualify for SSDI, the benefit you can get is called SSI, and it is not a lot of money. I think the maximum monthly SSI benefit right now is $994. And to remain qualified for this $994 monthly benefit, you really can have no assets. I think the maximum you can have in a savings account is $2,000. If you have worked the required number of credits, and paid into SSDI all your years, the maximum benefit is much more: $4018 per month. And it is not means-tested - you can have a million in the bank in assets, it doesn't matter. So very, very different in terms of what kind of life you can have, if you have the misfortune to become disabled. |