Legal Definitions - OASDI

OASDI stands for Old Age, Survivors, and Disability Insurance.

OASDI is the official and comprehensive name for the federal program commonly known as Social Security in the United States. It is a social insurance program that provides financial benefits to eligible individuals and their families. These benefits are funded primarily through payroll taxes paid by workers and their employers. The program is designed to offer a safety net in three main areas:

• Old Age: Providing retirement income to eligible individuals who have reached a certain age and have contributed to the system throughout their working lives.
• Survivors: Offering financial support to the spouses, children, or parents of deceased workers who were covered by the program.
• Disability: Supplying income to individuals who are unable to work due to a severe, long-term medical condition that meets the program's criteria.

Here are some examples illustrating how OASDI applies:

• After working for over 40 years as a registered nurse, Eleanor decided to retire at age 68. Each month, she receives a direct deposit into her bank account, which helps cover her living expenses and allows her to maintain her lifestyle. This regular payment is an Old Age benefit provided through OASDI, reflecting her lifetime contributions to the Social Security system.

• When Michael, a construction worker, tragically passed away at 40, he left behind his wife, Jessica, and their two young children. Because Michael had consistently paid into Social Security throughout his career, Jessica and the children became eligible for Survivors' benefits. These monthly payments from OASDI help Jessica manage household costs and support her children's upbringing, demonstrating the program's role in protecting families after the loss of a primary earner.

• Sarah, a graphic designer, developed a debilitating autoimmune disease that made it impossible for her to continue working or perform any substantial gainful activity. After a thorough medical evaluation and application process, Sarah was approved to receive monthly Disability benefits. These payments from OASDI provide her with crucial income, allowing her to maintain financial stability despite her inability to work due to her long-term health impairment.