The term social security income is difficult to define because it can refer to several programs. In fact, social security income is often a misnomer for Supplemental Security Income (SSI), a special U.S. government program intended to help those young or old who are generally legally blind or are severely disabled otherwise. This should be understood as completely different from the payroll tax funded program Old Age, Survivors and Disability Insurance (OASDI), which relies on money collected as social security taxes. SSI doesn’t work this way.
There are some real big distinctions between the different types of social security income. SSI is available to anyone who qualifies, not just workers. In fact, it can be collected by any eligible person of almost any age, since the person or their caregivers meet certain income requirements. It is quite possible that SSI checks will be made out to the parents of a severely disabled baby, and if that baby can never develop the skills to work, he or she could receive payments for a lifetime. These are not huge and are barely enough to sustain life in shared rooms; they increase as any other income decreases and can be stopped if a person earns a high enough income.
In contrast, the social security income that relates to OASDI generally goes only to the people who have earned it or their survivors. As people work throughout their lives, they create credits, which make them eligible to collect the “retirement payment” or to collect part of this payment if they become permanently disabled before retirement age. This payment is not only available to the worker, but also a spouse is generally eligible to collect part of it when they reach retirement age. In the event that a person with children dies before those children are 18 years old and they have already earned the right to collect the OASDI form of social security income, the children may be eligible to collect survivorship benefits.
OASDI and SSI disability payments can vary little or a lot. First, most people who have never worked cannot get a disability through OASDI and are therefore not eligible to participate in programs like Medicare. However, sometimes a person who receives disability payments through OASDI may be eligible for additional SSI, and if they cannot afford Medicare, they may qualify for Medicaid. Today, those who receive even a dollar of SSI must automatically receive Medicaid. They get this even if they are insured elsewhere, and it doesn’t matter how old they are.
However, OASDI social security income is often more attractive because the payments tend to be slightly higher. On the other hand, some people may qualify for both. The amount of the disability payment is often not based on current income, but rather the amount that has been considered “earned” from wages for a lifetime. This is usually more than the SSI payments, although not always.
In general, you could say that social security income is any income derived from the government for retirement, disability, or other reasons. However, these programs have different means of funding and determining eligibility. They are clearly not the same, although they may share a common purpose.