Five Tips for Stretching Your Money When You're on Disability
Making sure you've got enough money to pay the bills is
always a challenge, but it can be especially difficult if you're on Social
Security Disability. Payments are strictly timed, and they are likely to be
less than what you're used to.
Whether you're temporarily disabled or you're settling into
a new normal, it's extremely important to learn how to stretch your money. That
way, you can worry less about how you're going to pay the bills and you can
spend more time focusing on your health and well-being.
Know How It Is Going to Affect Your Taxes
Don't automatically assume that because you're collecting
benefits you do not have to file taxes. For example, if you're collecting from an
employer-provided long-term disability insurance policy, whether or not
you're taxed will depend on who is paying the premiums. For example, if your
employer pays any portion of the premium, that amount is taxed.
Even if your income isn't taxable, being on disability can
affect your taxes in other ways. For example, you will not be able to claim
medical deductions if you're receiving tax-free payments from a private disability
insurance policy.
Because taxes can be so confusing, and the consequences of
getting it wrong can be so dire, it's a good idea to schedule an appointment
with a tax professional every year you file. That way, you can ensure
everything is accurate and Uncle Sam won't come knocking on your door for more
money.
Create a Budget
If you are having a hard time paying the bills, it can be
tempting to bury your head in the sand and take things one day at a time.
Although this may make you feel better in the short run, it won't help you in
the long run.
It's much better to get real about your financial situation
and create a budget. If you're struggling, use an online
template to help.
All reoccurring items should be included. That includes
monthly bills, but it also includes other recurring costs, like gas, groceries,
and medication. It may also include things like entertainment and shopping, if
these are things you do regularly.
Your budget will help you see exactly how much you have,
where you're spending the most, and it can provide you with opportunities to
save.
Look for Ways to Save
Not happy with how your budget turned out? There are many
sneaky ways
you can save money! A few things you can try include:
- Look at ads and use coupons before going grocery shopping
- Switch to a different cell phone plan
- Bundle services, like cable and internet
- Order smaller servings at restaurants
- Make your own coffee and smoothies
Saving may also mean practicing restraint. For example, if
there's something you want, instead of purchasing it right away, think about it
for a few days. You may find that the feeling passes and you don't need that
item after all.
Look for Other Programs That Can Help
Social Security Disability is a great program that can help
you survive if you become injured, but it isn't the only program that can help.
If you're still struggling to pay your bills, you may want to look for other
programs that can help too.
For example, there are ways you can save
on prescription costs, which includes applying for assistance. Many
nonprofits are willing to help you pay as long as you meet their income
requirements. You can also find programs that can help you pay for essential
services, like heating your home, as well as food banks, rental assistance, and
more.
Get a Part-Time Job
No matter how good you get at stretching your dollar, you
may find that you're short, no matter how you crunch the numbers. If that's the
case, don't automatically assume you're stuck. You can get a part-time job to make
a little extra cash.
Just make sure you're careful about the part-time job you
take. There are strict limits to how much you can work and how
much you can make if you're also on disability. You can also find incentive
programs that will continue paying your benefits while you're trained, if you
want to get back into the workforce but can't return to your previous job.
Don't let money stress you out while you're on Social
Security Disability! There are many things you can do to make the most of your
payments so you can make sure you pay for everything you need as long as you're
receiving benefits.
