How to Plan for Your Financial Future (with a Disability)

Navigating finances is a challenge for many people, but for a person with a disability, the future can seem even more intimidating. Fortunately, here are some solid ways to plan for your future needs so that you can live a less stressful life in the meantime.

Use Home Equity to Your Advantage

Using loans to pay for medical expenses isn’t always the best strategy. However, home equity loans typically have low-interest rates, and you’re borrowing against the value you’ve grown in your property. With an FHA-insured Home Equity Conversion Mortgage, for example, you can borrow funds to pay for medical care, household modifications, and other medical needs. And when you pay them back, you’re safeguarding your investment in the home. Another option is to use the equity you have in your home to refinance. By giving up some equity in your home, you can take out a new loan and pocket the difference in cash.  

Think About Buying a Home

If you don’t already own a home, purchasing property could prove to be a financial benefit later in life. For renters, paying toward a mortgage instead of monthly rental costs could present substantial savings. After all, once you pay your home off, you no longer have monthly payments. Both the government and some non-profit organizations aim to help people with disabilities purchase homes through a range of real estate programs.

Invest in Life Insurance

Life insurance helps protect both you and your family if anything happens to you. When you apply for life insurance, providers administer a blood test to determine how healthy you are overall. The results of the test help establish your rates. Any high blood pressure, cholesterol, BMI, or glucose levels, as well as substances such as tobacco or drugs that show up on the test, could impact your rates and coverage. The healthier you are, the higher the odds you’ll receive low-cost life insurance quotes.

Ensure You’re Utilizing All Available Tax Breaks

While living with a disability can be financially challenging, the government provides tax credits that can help offset costs. For example, many people are eligible for disability tax credits, which you can claim when filing your taxes. For those who are legally blind, have a disability that affects employment, or have high medical expenses, many disability tax benefits are available. By filing your taxes each year, and ensuring that your information is accurate, you can help reduce living expenses and potentially set aside savings.

Consider Educational Programs and Benefits

Because many people with disabilities are living on lower than average incomes, working toward gainful employment might help you to boost your income and save for the future. If you wish to return to work but would need to return to school to achieve that goal, the Social Security Plan to Achieve Self-Support (PASS) program might be the right fit. PASS allows you to set aside money for pursuing educational goals without counting the resources toward your SSI eligibility. Keep in mind that employment can affect your SSI benefits, so you should consider carefully whether the program is the right fit for your needs. If you do return to work, your SSI benefits could decrease or stop altogether. However, full- or even part-time employment can provide benefits such as retirement programs (401K or similar), healthcare, and childcare.

Invest in an ABLE Account

To help fund future expenses, you can open an exclusive tax-advantaged savings account. An Achieving Better Life Experience (ABLE) account is a unique savings account for people with disabilities, ABLE National Resource Center explains. The account uses post-taxed dollars and is not taxed. Qualification is simple for anyone who received a diagnosis before age 26, but others may still qualify. You and any of your family, friends, or donors can contribute to the account, and the balance “will largely not affect” your eligibility for government programs like SSI, Medicaid/Medicare, FAFSA, HUD, or SNAP/food stamps.

When you use the funds, you can spend them toward any “qualified disability expense,” including education, housing, transportation, assistive technology, personal support services, health care expenses, and more.

Planning for your financial future doesn’t have to be complicated. With these helpful steps, you can begin preparing well in advance. Then, you will benefit from safe and quality care when you most need it — without going into debt.

Photo via Pixabay

Disclaimer:  Please remember that any advice, Financial or medical, shared on Autisable is for informational purposes only. Please consult with a professional regarding your personal financial needs.

Ed Carter

As a former financial planner, I use my background and experience to help those with disabilities plan for their future. About 10 years into my career, I saw a need for financial planners who specialize in helping individuals and families living with disabilities. I created Able Futures to help people with disabilities prepare for a secure and stable financial future.