Social Security Disability Benefits and Roth IRAs
Can you invest your Social Security Disability benefits in a Roth IRA?
Roth IRAs are a type of individual retirement account that can allow you to save earned income while allowing that income to grow. You can withdraw that income at a certain point of time in the future. Roth IRAs are meant to be used to invest your after – tax earnings.
Do Social Security disability benefits qualify as earned income to be invested in a Roth IRA? The simple answer is NO. Social Security disability benefits are not considered earned income. However, if you are working part time and have a source of income in addition to the benefits that you receive every month, this earned income can be invested in a Roth IRA retirement account. One caveat to working under substantial gainful employment (the maximum amount you can earn each month and still be considered disabled) is that these earnings might trigger a continuing disability review by Social Security to see if you are actually still medically disabled. This is a risk undertaken when working while collecting disability.