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Saving for Post-Secondary Education

by Lucy Miller & Susan O’Mara

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There is a common misconception among individuals with disabilities, their families and the disability services provider community that saving for post secondary education is not permitted under the Social Security disability benefit program rules.  In fact, for individuals receiving disability benefits authorized under title II of the Social Security Act, there are no restrictions placed upon asset accumulation or the amount of resources a beneficiary may have. The title II disability programs include Social Security Disability Insurance (SSDI), Childhood Disability benefits (CDB) and Disabled Widow(er)s Benefits (DWB).  As of January 2007, the majority of adults receiving Social Security benefits based upon disability (more than 6.8 million individuals) were receiving a title II benefit.   These beneficiaries have always been at liberty to plan and save for future educational expenses without any fear that these savings would jeopardize eligibility for cash payments or Medicare health insurance coverage.   

Nearly 4.2 million individuals age 18-64 receive disability benefits through the Supplemental Security Income program (SSI).  Unfortunately, the SSI program is means-tested and does impose restrictions on both income and resources.  Currently, SSI program rules require that eligible individuals have no more than $2,000 of countable resources with a $3,000 limit for two SSI recipients who form of an eligible couple.  While this limit is stringent indeed, there are numerous resource exclusions which do not count in any way against the recipient when SSI eligibility determinations are made.  Several of these resource exclusions are specifically designed to permit SSI recipients to save for post secondary education or training which prepares them for paid employment.  This paper summarizes these provisions and provides information on additional resources individuals with disabilities may access to help cover the costs of education or vocational training after high school.