Disability benefits should be used for daily necessities rather than luxury items. This means you should use it for food, clothes, essential transportation, and necessary recreational activities. However, they should not be used for gambling on the horses or excessive amounts of alcohol or expensive meals in a restaurant. You should put some thought into how to best use your disability benefits before you find yourself in a situation where your pockets are empty because you haven’t used the money wisely.
What Can Disability Benefits Be Used For?
Even though there are actually no restrictions when it comes to how you are allowed to spend your benefits, you should still compile a budget before you start spending. This is because, before even thinking about spending your benefits on luxury items, entertainment, and getaways, you must take care of your bills and other essential monthly expenses before using the SSDI money for anything else. Essential monthly expenses could include:
- daily living expenses;
- house rental;
- mortgage repayments;
- utility, water and electricity bills.
What Can I Use My Back Pay On?
Back pay is the amount you should receive to cover any gap in the time your SSDI application was received by the SSA and when you started getting SSDI payments, minus the 5 months waiting time. When you receive your back pay, you can use it to pay for the following:
- rent or mortgage repayments;
- a security deposit on a rental property;
- repair or retrofit your house or apartment
- paying off debts
- stocking up on food staples,
- paying health insurance premiums and other medical expenses.
What If I Can’t Manage My Funds?
The SSA usually decides you need a payee if you need help in managing your money. When this happens, the SSA tries to select someone who knows you and wants to help you. The payee should be a person who interacts with you regularly and will know what your need.
If you don’t agree with the SSA that you need a payee, or if you want a different payee, you will need to write to the SSA within 60 days of them assigning you a payee to appeal that decision. The payee will receive your monthly disability benefits and must use the money to pay for your needs, such as:
- rehabilitation expenses (if required);
- personal care items;
- medical and dental expenses;
- housing and utilities;
After those expenses have been paid, your payee may use the remainder of the money to pay any past-bills and also give you spending money. If there’s any money remaining, your payee should save it for you. Your payee is required to maintain accurate records showing how the money has been spent and this must be sent to the SSA. The SSA may mail your payee a form each year. Your payee can either complete the form and send it by mail to the SSA or go online.