Raising children is expensive, and raising disabled children is more expensive. Couple this with the fact that a parent of a disabled child sometimes has to give up work to care for a disabled child.
If you can get your child approved for monthly SSI payments (which isn't easy), there are many ways you can make use of the benefit. Your child’s SSI payment amount will vary depending on the state you live in and whether your child has any countable income, but the federal base rate for 2020 is $783/month. (Read Nolo's article on how much SSI pays for more information.)
Social Security requires most children’s SSI to be paid to a payee, and the payee is most often a parent. Payees have the responsibility to keep track of the child’s SSI and to spend it for the child’s benefit. Social Security tells payees to spend a child’s SSI on the child’s “current maintenance,” which includes things like food, shelter, clothing, medical care, and personal care items. First, you should use the money to make sure your child has food and shelter.
Many parents of children receiving SSI use their child's benefits to help pay for the family's food and shelter. Even if your child qualifies for Supplemental Nutrition Assistance Program (SNAP) payments, formerly known as food stamps, that amount is likely not enough to feed a child for the entire month. SNAP payment amounts vary depending on household income and on what state you live in, but, on average, the maximum SNAP allowance of $3 to $5/day is not adequate to feed your child a healthy diet. If your family relies on SNAP, it is likely that you will need to use some of your child’s SSI to buy healthy food for him or her.
If you have not been able to get subsidized housing and are paying a market-rate rent or mortgage payment, then your housing costs are likely one of your largest monthly expenses. If you cannot afford your housing expenses (including utilities), then you have a responsibility to use your child’s SSI to ensure that she does not become homeless.
Once the child’s immediate needs are met, you can decide to use SSI to pay for medical or dental expenses that your child might have. The vast majority of children on SSI should qualify for their state’s Medicaid program, but each state’s program is different. In any case, your child may need services, treatment, or equipment that Medicaid will not pay for, and you can use your child’s SSI to pay the cost.
Some parents of disabled children use SSI funds to pay for occupational therapy or counseling that Medicaid doesn't pay for. SSI funds may also be spent on adaptive devices (wheelchairs, specially equipped vans, computers, and so on).
Remember that your child might be legally entitled to have Medicaid pay for a particular service, even though your state’s Medicaid agency has initially denied your application for the service. Medicaid requires states to provide any medically necessary treatment to an eligible child. If you have received a Medicaid denial for your child, don't give up. Request a Medicaid hearing on the denial, and consider consulting an attorney about the problem.
You may be considering using your child’s SSI to pay back past due bills. For example, you might owe medical bills that accrued while your child’s disability case was pending, before she was covered by Medicaid. Before you pay any old bills, make sure that your child’s current and reasonably foreseeable needs are being met. In general, Social Security says that a payee can consider paying old debts incurred by the child if the child will have at least two months’ of benefits saved up after the bills are paid.
Before you use your child’s SSI to pay off the child’s debts, consider whether the debts are valid and what the consequences of not paying the bills might be. In many circumstances, it may be in the child’s best interests not to pay debts. You may want to seek the advice of an attorney about the validity of the debt and the consequences of nonpayment.
Social Security allows payees to use SSI to pay for the child’s personal needs like clothing and recreation. If you have money left after providing for your child's basic needs and medical care, then you could spend your child’s SSI on things like a special summer camp for disabled children, enrollment in swimming lessons or ballet classes, or tutoring in math or language.
You can also set extra money aside as savings for your child. Keep in mind that your child will become ineligible for SSI if she has a savings account with more than $2,000 in it. If your child is 15 or older, you can set up a Plan for Achieving Self-Support (PASS) account for your child and create a larger savings account that will not jeopardize her eligibility for SSI.
If you waited a long time for your child to be approved for SSI, then your child might be entitled to some backpay from Social Security. If the backpay is an amount that is larger than six months of SSI benefits, then Social Security will require you to set up a separate account that it calls a “dedicated account.” You cannot put any other funds in the dedicated account.
There are particular rules for using money in a dedicated account. The money must be used for the child’s benefit and for medical treatment, job skills training, or education. The money can also be spent on things like personal needs assistance, special equipment, and housing modifications, as long as the expense is related to the child’s impairment. Some examples of allowed expenses are the cost of respite childcare, the cost of specialized computer equipment to allow your child to keep up in school, the cost of a specially equipped van to transport your child to ongoing therapy appointments, and the cost of moving expenses if your child’s disability requires you to change housing.
If you have questions about whether you can pay for a particular expense from your child’s dedicated account, discuss it first with Social Security.