Understanding Social Security and Benefits Your Child May Qualify For

by: J. Patrick Collins, CFP® , EA

The Social Security Administration can seem pretty daunting when trying to figure out what your child is entitled to. This article is meant to serve as a guide for families trying to decipher the benefit puzzle.

While every state and county may have separate benefit programs for children with disabilities, this article focuses on Social Security. The first thing to understand is there are two types of benefits your child may eligible for at some point: Supplemental Security Income (SSI) and Social Security Disability Income (SSDI).

First, SSI is what is considered a needs based program. The program was designed for those Americans who were disabled and had little resources. To qualify for SSI you must meet three criteria:

1. Be Disabled- the applicant must be unable to engage in Substantial Gainful Activity, have a disability expected to result in death, and have been afflicted with that condition for more than 12 months.

2. Have Limited Income- applicants cannot generally make more than $810 per month or they will be considered ineligible.

3. Have Limited Resources- applicant cannot have greater than $2,000 in his/her name.

For children under 18 who live with their parents, Social Security uses the parent’s income and assets to determine eligibility. When your child turns 18, Social Security considers him/her a separate entity and bases their decision on the child’s specific situation and the criteria above. The maximum federal SSI monthly benefit is currently $579.

Strategies should be implemented before a child turns 18 to insure that the child can qualify for the SSI benefit and will not be ineligible at some point in the future (that’s a whole other article).

The other type of benefit offered by Social Security is Social Security Disability Income (SSDI). This benefit is only available to children who are older than 18 years old. There are three criteria for a child to qualify for SSDI:

1. The child’s condition must meet Social Security’s definition of disability

2. The disability began prior to the child turning 22

3. The parent of the child worked long enough to be insured by Social

Security and the parent is receiving retirement benefits, disability benefits, or is deceased. SSDI, since it is not a needs based program, does not require as much planning as SSI does, but parents need to know of its existence in order to apply for benefits.
For 70 years Social Security has provided benefits for disabled and retired Americans. Understanding their programs and structure can add valuable resources for your family and your child.

The information in this article is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, and does not purport to be complete and is not intended as the primary basis for financial planning or investment decisions. It should also not be construed as advice meeting the particular investment needs of any investor.