If you are disabled and receiving Social Security Disability Insurance (SSDI) benefits, it is important to understand the rules about savings accounts. Many people with disabilities want to save up money for emergencies or for things like a car or home repairs.
The good news is that you can have a savings account on SSDI. But there are specific rules you need to follow in order not to jeopardize your benefits.
Let’s take a look at some of those rules so you can make the most of your savings account while still receiving SSDI benefits.
The Resource Limit
The first rule to be aware of when it comes to having a savings account on SSDI is the resource limit. This limit states that individuals cannot have more than $2,000 in resources if they wish to remain eligible for SSDI benefits.
These resources includes cash, mutual funds, stocks, savings bonds, cars (more than 1), properties (aside from residence and business property), insurance (above $1,500 face value), and other items that can be converted to cash used for food or shelter.
The Social Security Administration also considers any bank account with more than $2,000 at one time as a disqualifying resource, meaning you would no longer be eligible for SSDI benefits until the balance falls under $2,000 again.
So while it is possible to have a savings account on SSDI, it needs to stay within this limit to maintain eligibility.
However, there are exceptions if you want to save more than $2,000. These are the:
This is an SSA program that helps persons with disabilities save money to use for materials so they can get back to work, such as further training. There are no limits to how much money you can save in this program and the balance won’t be counted toward your SSDI limits.
This is for individuals who had a disability before 26, this is another savings option available through your state. You can set up this account and save up to $100,000 without any of it counting towards your SSDI limits.
However, depending on your state, you can only deposit a maximum amount monthly. The goal of the program is to help individuals with disability live a more comfortable life without solely depending on benefits but still not removing them from it.
Income Limits
Another factor that might impact your ability to have a savings account on SSDI is your income level. If your total income exceeds the Substantial Gainful Activity (SGA) threshold set by the Social Security Administration—which is currently set at $2,460 per month for 2023—it could also lead to loss of eligibility for disability benefits.
However, if you keep your earnings below this limit, then there should be no issue with having a savings account on SSDI. Although, if you do exceed the SGA threshold, then it’s important to talk with an experienced disability attorney as soon as possible in order to ensure your continued eligibility for disability benefits.
Spending Your Savings Wisely
Once you understand the limits imposed on having savings account on SSDI and how they affect your eligibility for disability benefits, then it’s important that you use those funds wisely and strategically. It’s easy enough just to save money into an account but not spend any of it—but that isn’t necessarily what’s best for you financially or mentally in the long run.
Spend your hard-earned money responsibly and strategically rather than letting it sit idle in a savings account that may even lose value due to inflation. Consider investing or using them towards large purchases like cars or medical equipment, which can really improve your quality of life and help make living with a disability easier and more manageable.
Having A Disability Shouldn’t Be A Limit
It is possible to have a savings account if you are receiving Social Security Disability Insurance (SSDI) benefits—but there are certain limits that must be followed for those funds not to disqualify you from those same benefits.
Individuals who receive these benefits must understand the resource and income limits associated with having a savings account, so they don't risk losing their eligibility altogether. However, if managed responsibly, these same funds can bring huge rewards both financially and psychologically.
With careful planning and wise spending decisions, having a savings account while also collecting SSDI can become one of the best investments an individual could make.
Are you thinking of applying for an SSDI benefit? Check out our article on Things To Know About SSDI Approval Timeline so you know what to expect when you’ll receive your benefit and how you can increase your chances of getting approved.
