4 Ways to Provide For Your Future When You Have a Disability
Managing the stress and anxiety of living with a disability is a life-long practice. As things change, it is important you have a solid, yet flexible, plan for long-term safety and security. That plan can reflect a lot of things, like home modifications, emphasis on independent living, and income. All of those elements are wrapped up in financial planning.
Talking about financial planning can be stressful, and putting the complexity of a disability in the mix can make it feel even more so. Here are a few planning tips to help people with disabilities secure their financial future.
Understand Medicare and how it works
Many people with disabilities can apply for Medicare coverage at any time, depending on your Social Security disability status. People with certain disabilities, like Lou Gehrig’s disease or End-Stage Renal Disease, often automatically qualify, while people with other types of disabilities or medical conditions will have to research and apply. Once you have your Social Security disability status you can use your Medicare benefits, but it is important to be mindful of the gaps in coverage.
Medicare doesn’t cover every healthcare situation. Often dental, vision, prescription drugs and other healthcare services are left out. That’s why many people look into boosting their coverage with a Medicare Advantage plan.
Financial stability for children with disabilities
If you are a parent of a child with a disability, you have a major responsibility to ensure your child has a high quality of life after you are gone. Securing your child’s financial future can be accomplished in many ways, such as investing in a life insurance policy, purchasing long-term care coverage, and creating a monthly budget that emphasizes savings.
When looking at life insurance, it’s important you understand your options so that you make the right choice for you and your child. For example, a term-life insurance policy will end after a certain time frame, like 20 or 30 years. On the other side, a whole-life insurance policy, which will have higher premiums, is yours for life.
Take advantage of grants and loans for people with disabilities
The costs of modifying a home for a disability can add up. For example, a kitchen remodel in nearby Baltimore can cost up to $21,000. There are programs out there specifically designed to help offset the cost of living with a disability. People with disabilities can apply for specific grants that can help improve home accessibility so you or your loved ones can live more independently. There are grants provided by the government, like HUD and the USDA, and there are also nonprofits and other entities that offer grants and loans to help cover housing repairs, weatherizing, and remove safety hazards.
There are many loans out there that have lower percentage rates and more flexible repayment terms for people with disabilities. Since grants are funds you don’t have to pay back, it’s important to start there and then utilize these specialized loans to coverage everything else.
Use tax breaks to bulk up your savings
People with disabilities can apply for various tax breaks on their tax forms, from deductions for having low or no vision to writing off medical expenses. With the same Social Security disability status that enables you to access Medicare before 65, you can also use the Disability Tax Credit and the Earned Income Tax credit. You can also apply for an ABLE account, which allows people with disabilities the option to set aside pre-tax income for medical expenses.
Depending on whether you have taxable income, using tax breaks can keep more money in your pocket that you can then t uck away in savings, invest in a 401k or other retirement plan, or put toward long-term care insurance or some other program that offers some security for your care in the future.
Managing a disability comes with many hoops and hurdles, and finances will always be a big one. Whether you have recently been diagnosed or you have been living with a disability most of your life, it’s important to know ways to gain financial support for you, your family, and your future.
Article by Mr. Ed Carter - ablefutures.org