Will selling home and investing $700K affect my SSDI benefits and Medicare as a divorced 63-year-old?
I'm in a bit of a panic about my upcoming financial change. I'm 63 and have been receiving SSDI benefits for the past 8 years due to a chronic heart condition. My divorce just finalized last month, and we're selling our family home as part of the settlement. After everything's paid off, I'm expecting to get around $700,000 as my share. I'm planning to invest about $400,000 of this money so I can generate some additional monthly income to supplement my disability benefits (currently only $1,875/month). The rest I'll use to buy a small condo and have some emergency savings. What I'm worried about is whether this sudden influx of assets will affect my SSDI benefits or Medicare coverage. I know SSI has strict asset limits, but I'm on SSDI. Will the money from the home sale or the investment income impact my benefits? And what about Medicare premiums - will they go up because of this? I need to plan carefully since I'm still 2 years from FRA and this money needs to last.
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Tristan Carpenter
Good news - the money from selling your house won't affect your SSDI benefits at all. SSDI has no asset limits, so you can have millions in the bank and still get your full SSDI payment. That said, there are two things you should be aware of: 1) If you INVEST that money and earn interest/dividends, that doesn't count as "earned income" for SSDI purposes. So investment income won't reduce your disability benefits. 2) HOWEVER - your Medicare premiums are based on your income from 2 years prior. This is called IRMAA (Income-Related Monthly Adjustment Amount). If your investment income pushes your total income above certain thresholds, your Medicare Part B and D premiums could increase starting in 2027 (based on your 2025 income).
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Maya Jackson
•Thank you so much for explaining this! What a relief about the SSDI! Do you know roughly what income threshold would trigger higher Medicare premiums? I'm trying to figure out what types of investments would be best to minimize the impact.
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Amaya Watson
Be very carefl with this money!! My brother got an insurance settlement and invested it and then social security took away ALL his benefits!!! They said he had too much in his account. He had to spend it all before they would give him his checks back. The government wants us all to be poor!!!!
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Grant Vikers
•Your brother was likely on SSI (Supplemental Security Income), not SSDI (Social Security Disability Insurance). They sound similar but are completely different programs. SSI is needs-based with strict asset limits (currently $2,000 for individuals). SSDI is based on your work history and has no asset limits whatsoever. The OP mentioned they're on SSDI, so the home sale proceeds won't affect their eligibility.
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Giovanni Martello
I'm in almost the same boat! Got divorced at 62, sold our house, and was worried about my disability. My social worker told me SSDI doesn't care about assets but said watch out for the tax implications. If you earn too much interest income, you might have to pay taxes on 85% of your SSDI benefits. Maybe talk to a financial advisor about tax-advantaged investments?
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Maya Jackson
•That's a really good point about the tax implications I hadn't considered. I'll definitely look into tax-advantaged options. Did you find a financial advisor who specifically understands Social Security rules? I'm worried about getting advice from someone who doesn't understand the SSDI system.
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Savannah Weiner
When I went through something similar last year, I needed to speak with SSA directly about how my financial changes would impact my benefits. I tried calling for WEEKS and either couldn't get through or got disconnected after hours on hold. Finally, I found this service called Claimyr (claimyr.com) that got me connected to a real SSA agent in under 20 minutes. They have a video showing how it works: https://youtu.be/Z-BRbJw3puU It was worth it to get clear answers directly from SSA about my specific situation. The agent I spoke with confirmed that assets don't affect SSDI but explained exactly how my Medicare premiums would be calculated with my new income level.
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Levi Parker
•does this actually work? i've been trying to reach ssa for 3 days now!
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Savannah Weiner
•Yes, it worked for me - I was skeptical too after weeks of failed attempts calling SSA directly. But they connected me quickly and I got all my questions answered in one call. Definitely less frustrating than the regular SSA phone system.
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Libby Hassan
My mom just went thru this!!! The house money is fine but watch out for Medicare! Her premiums went WAY up after she got money from her divorce! She said if she knew she would have done her investments different!
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Tristan Carpenter
•This is an important point. For 2025, IRMAA kicks in for individuals with income above $103,000. At that level, Medicare Part B premiums increase from the standard $208.90/month to about $333.00/month. The brackets go up from there. Municipal bonds might be worth considering since the interest is generally tax-exempt for federal purposes and wouldn't count toward IRMAA calculations.
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Grant Vikers
I'd recommend speaking with both a financial advisor AND an elder law attorney who specializes in Social Security issues. While your SSDI is safe regardless of assets, there are several planning opportunities here: 1. Consider how you'll handle the transition from SSDI to retirement benefits at your Full Retirement Age 2. Structure investments to minimize taxable income (potentially using Roth accounts) 3. Plan for long-term care needs which Medicare doesn't cover 4. Consider whether a Special Needs Trust might benefit your situation With proper planning, you can maximize both your SSDI benefits and your investment returns while minimizing tax impacts.
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Maya Jackson
•Thank you for these suggestions! I hadn't thought about the transition from SSDI to retirement benefits. Do you know if my retirement benefit will be the same amount as my current SSDI? And I'll definitely look into tax-advantaged investments - that seems to be a common recommendation.
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Grant Vikers
•Yes, when you reach your Full Retirement Age, your SSDI will automatically convert to retirement benefits, typically at the same amount. The advantage is that after FRA, you're no longer subject to the earned income limits that apply to SSDI. But investment planning is still important for minimizing taxes and IRMAA surcharges. A financial advisor familiar with Social Security rules can help optimize your specific situation.
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Amaya Watson
I went thrugh a divorce and home sale to and my SSDI didn't change at all but taxes were a NIGHTMARE!!! Make sure you put some money aside for taxes because I didn't and regretted it BIG TIME.
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Maya Jackson
•Oh no, I'm sorry that happened! Was it just income taxes on the investment earnings, or were there other tax implications I should know about? I'm definitely going to consult a tax professional before making any decisions.
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Levi Parker
congrats on the divorce lol! i've been on ssdi for 15 yrs and they never check my bank accounts ever. only ssi cares about that stuff. you're good to go!
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Maya Jackson
•Thanks for confirming! This whole thread has been so helpful. I feel much better knowing my SSDI is secure regardless of the home sale.
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Tristan Carpenter
Just to summarize the key points that have been discussed: 1. Your $700,000 from the home sale will NOT affect your SSDI benefits (no asset limits) 2. Investment income doesn't count as earned income for SSDI purposes 3. However, investment income could: - Potentially make part of your SSDI taxable - Potentially increase your Medicare premiums (IRMAA) if your income exceeds $103,000 4. Consider tax-advantaged investments like municipal bonds 5. Consult with financial advisors and elder law attorneys who understand Social Security With proper planning, you should be able to use this money to significantly improve your financial situation without jeopardizing your benefits.
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Maya Jackson
•Thank you SO much for this clear summary! This has been incredibly helpful. I feel much more confident now about moving forward with the home sale and making investment decisions. I'll definitely consult professionals, but having this basic understanding makes a huge difference.
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