Earning and saving money while disabled

While I’ve written a fair amount about working while disabled, I haven’t more deeply explored other ways to bring in money(or exactly what qualifies as ‘earning’ money), so I thought I would do so today.

I also thought it would be good to talk a bit about how you may be able to protect yourself financially by not having all of your income or assets be counted against you when it comes to additional support programs.

Why and how earned income matters

Whether you are working for somebody, self-employed, selling possessions online, or renting out space in your own home, you are receiving money for something you provided.

When social welfare programs were created in the US, there was a big presumption built around the capability of the disabled population, and why people would need financial support. It boils down to this: a disabled person is only eligible for support if they ‘earned it’ through consistent and recent employment, or if they are in a position of financial need.

While there are people with disabilities who work, they either work full time(or close enough to get benefits) for an organization that provides medical benefits, or work for an extremely limited income so that they can maintain government benefits.

If they are on Supplemental Security Income(SSI) or Social Security Disability Insurance (SSDI)(the two ‘disability’ payment programs), they not only need to have a recognized disability that is considered totally disabling, but they also need to have an earned income under the program’s ‘magic number’.

In 2019, that ‘magic number'(often referred to as ‘substantial gainful activity, or SGA) was $1,200 per month, despite the fact that disability benefit amounts can be as high as $2,000/month or so.

Being on these programs is the best way to ensure health care coverage, so for a disabled person to have the best chance of a healthy life, they need to stay on these programs, unless or until they can find a job that they know they can handle on a full-time basis that provides high-quality insurance, at a location they are sure will employ them for the long term.

These types of jobs are getting more and more difficult to find for anybody, so for people with disabilities, there is a lot of extra risk and fewer rewards for earning their way off of disability.

Due to this very tight roof on earned income, it’s essential that if you live with a disability, you know precisely what is considered ‘earned income’ and how much money you can afford to earn before your benefits are endangered.

Unearned income, and when and why that matters

Unearned income is any money that you receive that you didn’t earn. This may be gifts from others, benefits like SSDI or SSI, or interest from bank or investment accounts.

If you are on SSDI, your unearned income isn’t anything you need to worry about.

Just like there are no rules about what assets you can or can’t have when you retire(and get social security retirement benefits), how much money you have, or have invested, doesn’t really affect how big or small your monthly check is.

That check simply is based upon your work history(and strongly affected by your income the previous 10 years).

However, if you are on SSI, your benefits are directly affected by both your earned and unearned income.

SSI is only for low-income people with disabilities(those ineligible for SSDI due to lack of recent work history), so on top of proving your disability, you also need to prove your lack of resources.

In order to be eligible for SSI, you must have under $2,000 of total resources(anything that could be converted to money as well as unearned income), the only resources that may be excepted are a house and a car. Any savings or investments or property are counted.

If you are married, you may have up to $3,000 of shared resources.

For SSI, therefore, what you have(and don’t have) becomes an essential part of your eligibility determination.

The primary positive of this is that if you prove eligible for SSI, then you are automatically eligible for some support from pretty much every need-based support programs this country has.

These programs include Supplemental Nutrition Assistance(SNAP), Medicaid, and heating assistance(LIHEAP).

Often state-based disability or need-based programs will also accept your having SSI as proof of eligibility.

For example, I’m eligible for a reduced-fare card for the New York City transit system(MTA) and for disability/senior pricing on New Jersey Transit(trains, light rails, and buses throughout New Jersey) because I am on SSDI.

Is there any way to keep any money from being counted?

The basic answer is probably.

Each workaround has it’s own rules, of course. When it comes to earned income, I’ll refer you to previous writings of mine about working on SSI and working on SSDI.

Unearned income primarily matters for people on SSI. The most likely option for protecting unearned income, if you are eligible, is an ABLE account.

ABLE accounts were created for people who became disabled earlier in life(currently you’re eligible if you became disabled before you turned 26) to give us a space to hold resources for improving our quality of life.

While you can’t just pull money from your ABLE account, you can use money in the ABLE account for anything that helps you live a better life with a disability.

Wheelchairs or other disability-related supports can be taken from the account, as well as food and housing payments.

ABLE account is also a great way for friends and family to help out without spending money on a more restrictive Special Needs Trust or having your income be reduced by their support.

While ABLE accounts are run by different states, your state doesn’t need to participate for you to have an ABLE account and most ABLE accounts don’t require state residency for you to participate.

ABLE accounts are another step forward in disability rights, as they are the only program based on acknowledging the increased cost of life while living with a disability.

Their legislation is still being worked on, with efforts being made to increase the age of eligibility for ABLE accounts.

When I first looked into them several years ago, I wasn’t eligible because the requirement then was to have your disability start prior to the age of 22.

Since then, the age has been revised up to 26(making me eligible, as I was diagnosed at the age of 23) and they are working to get that revised even higher.

Basically what I’m saying is that if your age of onset is over 26, you currently aren’t eligible for an ABLE account, but it’s worth revisiting every few years to see if it’s been adjusted.

Protect your earnings and income when it comes to disability

You deserve to have peace of mind with managing your condition.

Be aware that no matter what disability program you apply for, you’re going to need to be very aware of the income-related rules and regulations to maintain your income and insurance coverage.

If you have applied for SSI, make sure you also stay aware of all the resources you have, as any income or asset may be counted against you with that program.

Finally, know that there are some workarounds for protecting income and assets, but the most likely program, ABLE accounts, is only available for people who became disabled before the age of 26.

I hope this post has given you some insights to help yourself as you find the right supports for you.