Social Security Disability and Your Finances

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If you are one of the many Americans who will develop a serious mental or physical disability this year, turning to a Social Security Disability Insurance representative can help you avoid financial disaster

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Social Security Disability and Your Finances

  1. 1. If you are one of the many Americans who will develop a serious mental or physical disability this year, turning to a Social Security Disability Insurance representative can help you avoid financial disaster.
  2. 2. <ul><li>Budgeting will give you a realistic idea of how much money you have, how it’s spent, and where to cut back. </li></ul><ul><li>Be as detailed as possible, including every expense you can think of – mortgage or rent, utilities, credit card balances, car payments, supplemental health insurance payments, groceries, gas, doctor’s visits, and more. </li></ul><ul><li>Once you’ve created your budget, it’s easy to see where and how you spend your money. </li></ul><ul><li>Try to identify areas where you could cut back while you wait for your SSDI benefits . </li></ul>
  3. 3. <ul><li>Identifying current and future income sources must be a top priority for those in the SSDI application process. </li></ul><ul><li>Using an online net worth calculator can help you identify your assets, including stocks, vehicles, jewelry, and more. </li></ul><ul><li>There are several federal, state, and local financial assistance programs that can help you with utility bills, food stamps, public transportation, and more while waiting for your SSDI benefits. </li></ul><ul><li>If you have younger children, they may be eligible for free or reduced-price meals, even during the summer. </li></ul>
  4. 4. <ul><li>Budgeting allows you to see what you’re spending each month on both essential and non-essential items. </li></ul><ul><li>You may not be able to cut expenses for housing, food, healthcare, and utilities, but you can cut expenses like weekly manicures. </li></ul><ul><li>Proper planning and cutting back on little things can really add up. </li></ul><ul><li>If you’re used to eating out twice a week, cut it back to once a week, and go where they serve large portions so you can save half for another meal. </li></ul>
  5. 5. <ul><li>The first step to managing your debt is determining your current debt situation, and then taking steps to whittle it down. </li></ul><ul><li>If you have credit card debt, pay off the card with the highest interest rate first. If you owe money to multiple credit cards, you can consolidate them or speak with a debt counselor. </li></ul><ul><li>You might be able to consolidate your debt into your mortgage if you own a home. Your lender may work with you to reduce your interest rate, which can lower your monthly payments. If you can reduce your current interest rate by at least 2 percentage points, you should seriously consider refinancing. </li></ul>
  6. 6. <ul><li>You may be eligible for COBRA coverage if you leave a job where you were receiving health benefits through your employer. </li></ul><ul><li>Although most people can receive COBRA benefits for 18 months after leaving a job, those who the SSA determine disabled may receive an 11 month extension and extra coverage. </li></ul><ul><li>Medicare is another option. While it’s usually only available to those over 65, people who have been receiving SSDI benefits for 24 months are also eligible. </li></ul><ul><li>People with ALS/Lou Gehrig’s disease, or end-stage renal disease or kidney failure may qualify for Medicare benefits sooner. </li></ul>
  7. 7. <ul><li>Look into drug assistance programs to dramatically reduce your healthcare costs or consider switching to generic drugs. </li></ul><ul><li>The Food and Drug Administration claims generic prescription drugs can yield a 50 to 70% savings. 75% of drugs have generic equivalents, so your medication may have a generic version. </li></ul><ul><li>Although generics are supposed to be the same as the brand name, there can be slight differences that may cause allergic reactions or minor side effects in some people. Talk with your doctor to see if switching to generic medication is right for you. </li></ul>
  8. 8. <ul><li>Both SSDI monthly payments and retroactive payments are taxable. How much you’ll pay depends on the amount you receive and your other income. </li></ul><ul><li>Monthly SSDI benefits are treated like normal Social Security payments and involve form SSA-1099. </li></ul><ul><li>While you will account for retroactive payments in the tax year you receive them, you do not treat all of this retroactive award as income in that tax year or you’d pay unnecessary taxes. </li></ul><ul><li>Consider hiring an accountant or seek tax assistance so you don’t overpay your taxes. </li></ul>
  9. 9. <ul><li>Budgeting </li></ul><ul><li>Looking for ways to increase your income </li></ul><ul><li>Decreasing your expenses </li></ul><ul><li>Managing your debt </li></ul><ul><li>Managing your healthcare costs </li></ul><ul><li>Looking into drug assistance programs </li></ul><ul><li>Properly filing your taxes </li></ul>Managing your finances while simultaneously managing a disability is difficult. However, you can work toward financial stability while waiting for and receiving Social Security Disability Insurance by:
  10. 10. This valuable information is brought to you by Allsup, your Social Security Disability and Medicare partner. We help you find the right SSDI or Medicare coverage for your specific needs. Visit www.allsup.com to complete our FREE, no-obligation Social Security disability evaluation today.

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