By Michael R. Roush, Director, Real Economic Impact Network, National Disability Institute
Often individuals with disabilities may not be familiar with the savings options available to them, or they may be afraid to save money in fear of jeopardizing their public benefits. However, individuals with disabilities can potentially access a wide variety of saving strategies to achieve their savings goals and improve their financial well-being. We are partnering with America Saves to leverage both of our networks and resources to expand opportunities for individuals across the spectrum of disabilities to make a savings plan by choosing a savings goal and an amount to save each month. At National Disability Institute (NDI), we focus on five key strategies that we believe can help individuals build a life of work, savings, and asset development. The five key strategies are:
1. Benefits Planning and Work Supports
There are savings options available to individuals who receive a needs-based benefit, such as Supplemental Security Income (SSI), through the Social Security Administration (SSA). The SSA offers work incentives that support an individual to go back to work and maintain employment while receiving a public benefit. An example of this is the Plan to Achieve Self-Support, often referred to as PASS, which allows individuals to set aside income other than Supplemental Security Income (SSI) and/or resources for a specified period of time so they may pursue a work goal that will reduce or eliminate the SSI or Social Security Disability Insurance (SSDI) benefits they currently receive. An individual could, for example, set aside money to go to school to get specialized training for a job or to start a business. To learn more about PASS or other work incentives, review the SSA’s Red Book.
Employment is important to improving financial well-being, and individuals with a disability can access employment services to help them obtain, maintain, or enhance their employment status. A great starting point is to visit a local American Job Center (AJC), also called Workforce Centers or One-Stop Centers. AJCs are designed to provide a full range of assistance to job seekers under one roof. They offer training referrals, career counseling, job listings, and similar employment-related services.
3. Free Tax Preparation
Tax time is an ideal time to encourage individuals with disabilities to save money. We find that individuals with disabilities will often not file a tax return either because of low wages or in fear that if they file and receive a tax refund, they will lose their public benefits. It is important for these individuals to know that refunds received from the Earned Income Tax Credit (EITC), the Child Tax Credit (CTC), or other refundable credits are not considered income. In addition, these refunds are not counted as a resource for at least 12 months from when an individual receives it for benefits or assistance under any federal program or under any state or local program financed in whole or in part with federal funds. More information about disability and free tax services is available from the IRS.
4. Financial Education
Financial education is a critical first step on the road to financial stability. There are a variety of financial education curriculum and tools available to help learn about savings. NDI has several initiatives dedicated to understanding and implementing key financial concepts to help people with disabilities take hold of their financial futures. Another source is FDIC’s Money Smart, which provides an accessible curriculum that is frequently used by disability organizations.
5. Asset Development
Individuals may not be aware of programs that can assist them in saving money to buy a home, go back to school, or to start a business. One such savings options is an Individual Development Accounts (IDA). If an individual saves money in a matched IDA program, the funds will not impact their eligibility for federal benefit programs. Similarly, ABLE Accounts are a savings option for individuals with disabilities who qualify. ABLE Accounts allow an individual to save up to $14,000 per year without these funds impacting a needs-based benefit such as Supplemental Security Income. Money saved in an ABLE Account can be used to pay for qualified disability expenses.
National Disability Institute is the first national organization committed exclusively to championing economic empowerment, asset development and financial stability for all people across the full spectrum of disabilities. We affect change through public education, training, technical assistance and policy development to help the one in three Americans with disabilities living in poverty take steps toward creating brighter financial futures. To learn more, visit www.realeconomicimpact.org. If you have specific questions on savings options for persons with disabilities, please send an email to firstname.lastname@example.org. Engage with NDI on Facebook: RealEconImpact or follow NDI on Twitter: @RealEconImpact.
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