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Work for Free? Who me?

In the novel “The Adventures of Tom Sawyer”, the protagonist tricks his friends into doing a large chore for him for free. The story does not recount whether the boys, who did the work, remained his friend when they realized that they had been duped. However, I’m thinking that they must have been at least a little peeved. Who wants to work for free?

I was at a transition planning committee meeting, the other day. One of the presenters, who works for Gigi’s Playhouse , mentioned in passing that some people, who attend Gigi’s employment readiness programs, don’t want paid work for fear that it will disrupt their benefits that they need. I always feel a bit sad when I hear that because 1) it’s not true and 2) who among us, who is not independently wealthy, would settle for primary employment that does not pay? I should note here that Gigi’s is a strong proponent of paid work for its members.

I’ve said this before, but it bears repeating—a lot in fact. People with disabilities are almost always better off working and earning money than not. To show you, here’s an example using Supplemental Security Income (SSI), which is the first benefit for which a person with a disability usually qualifies. SSI is means-tested. This is a more palatable way of saying that it’s welfare. You don’t have to contribute anything in Social Security tax to get it. If you have a disability, you just have to be poor. Which means you can’t have too much money in the bank and you cannot earn too much. But there is nothing in the rules that says that you cannot earn at all. And since a worker only loses fifty cents of SSI for every dollar that s/he earns, the worker still has more money. Let’s do the numbers, shall we?

Clara receives SSI. Since she pays her parents’ room-and-board (that’s a different topic), she receives the full amount of $750 a month (2018). But she’s bored for being at home all the time, and she’d like to have additional funds, which would give her a livelihood. Her parents help her find a part time job at the neighborhood café. She now works 15 hours a week at $10/hour, and she’s earning $600 a month. The first $85 do not count when Social Security calculates her SSI. Of the remaining $515, half or $257.50 does not count. The remaining $257.50—let’s round up to $258—is deducted from her SSI benefit. So:

Before: Total income = SSI = $750/month

After: Total income = SSI + wages = $492 + $600 = $1,092/month

In addition to having over $300 of additional disposable income, Clara also has new experiences, a chance to learn new skills, an ability to socialize with co-workers, and a way to use her talents. Since she is paying Social Security tax from her paycheck, she also has a way to earn Social Security credits toward retirement benefits, and (in the kind of circular logic that you might expect from a government program that evolved through over time through many different administrations) credits toward disability benefits. Yes, if you have a disability, then you can start work, and earn enough credits, so that you go on Social Security Disability Insurance (SSDI) from your own work. You earn one credit for every $1,320 in gross work income (2018). You can also earn a maximum of 4 credits/year. How many credits you need to get SSDI depends on your age. You can find a more detailed discussion here.

Now, let’s say that Clara, who is 21, goes on to earn 6 credits by the time she is 24. She now qualifies for SSDI on her own work record. SSDI is based on her work history, which is short, so she only qualifies for $200/month to start with. Because her SSDI benefit is lower than her SSI benefit, she continues to get the SSI, although it is reduced dollar for dollar for the amount of SSDI after $20. Her work income continues to reduce her SSI by 50 cents for every dollar over $65. So her SSI benefit is reduced by $180 due to the SSDI and then by $268 due to her working. So now, her income looks like this:

Before: Total income = SSI = $750/month

After: Total income = SSI + SSDI + wages = $302 + $200 + $600 = $1,102/month

We’re seeing that anyone with a disability can work and earn more money without losing his/her SSI benefit here. Now, let’s say that Clara continues to develop at her job. Now, she is working 25 hours a week and earning $1,000/month. Her SSDI benefit, which grows as she accumulates higher-earning years, is now $300. Of this, she gets to keep $20. The remaining $280 reduces her SSI benefit to $470. She gets to keep the first $65 of her work earnings. Half of her remaining income—$935/2= $468—counts against her remaining SSI. So now, the picture looks like this.

Before: Total income = SSI = $750/month

After: Total income = SSI + SSDI + wages = $2 + $300 + $1,000 = $1,302/month

One of the criteria for “having a disability” according to Social Security, is the inability to earn more than $1,180/month (2018). As long as Clara earns below that threshold (which is indexed almost yearly), she can continue to receive her full SSDI benefit and keep all of her work earnings. If she believes she has the capacity to earn more than that on an ongoing basis, she may want to risk crossing the line and going off her benefit; knowing that she can go back on it if, due to her disability, she finds herself unable to sustain earning at that level. That, however, is a discussion for another day. Beyond a doubt though, it is better to work for pay than not. Don’t be the victim of a Tom Sawyer outlook. Take pride, and wages, from your work.

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