I’ve heard many parents say they are afraid if their children work they will lose their benefits. Although this is a valid concern, there are protections in place to help the children maintain their benefits for as long as possible. The problem, as I see it, is there is not enough awareness and/or education about what these benefits are. So I’m going to give a brief overview, and hopefully arm families with enough information to advocate for themselves.
It is NOT a dollar for dollar reduction of one’s SSI if they are employed and earning income. It’s $1 for every $2 earned, which works out to a monthly income of $1,627 ($19,524/year in 2019) – after setting aside the first $65. Even this is not set in stone, because if the worker has qualified disability expenses these may be applied to reduce their earned income. Additionally, if the worker is still a student, they may be eligible for a student earned income exclusion ($7,550 in 2019).
For example – let’s say your disabled child is working at Target and makes $20k/year. They are unable to drive because of their disability and there is no public transportation available to get them to/from work – so they take an Uber. The Uber costs $75/week and the child works 50 weeks for the year (total Uber cost is $3,750). The child may be able to reduce the cost of the Uber, reducing their annual income to $16,250 – meaning they would still receive SSI. If the child was still in school then the earnings applied towards SSI would be further reduced to $18,700 ($20k – $7,550 – $3,750).
I understand this is complicated – the key take-away is your child can, and should, work. As they work they will earn credits towards their own social security benefit when they are older. They can also contribute more to their ABLE accounts – up to an additional $12,140 of their income (2019) if they are not participating with an employer’s retirement plan. And if they do contribute to the ABLE they may qualify for a Savers Credit on their taxes!
The last seed I want to plant is using Social Security’s Ticket to Work Program. I don’t think enough people know about this, or maybe they’ve heard the term but no one has explained how it can help. It’s designed to help individuals, ages 18 – 64, who are receiving either SSI or SSDI become financially independent. It does this by providing tools and supports – things like a job coach, career planning and counseling, benefits counseling and training programs (to name a few). But you have to ask for this – it’s a voluntary program.
If this seems overwhelming you don’t have to do any of it on your own. If you’re working with an Advisor ask them for help. If you’re not, or the Advisor isn’t sure what to do, reach out to us (Planning Across the Spectrum), we’ll connect you with the right resources in your State to get the ball rolling.