If you're approaching the $2,000 SSI resource limit, you may need to spend down before the 1st of the month. Here's how to do it wisely.
In this article, we'll cover:
- What spend-down means
- Purchases that reduce countable resources
- What doesn't count as spending down
- Smart spend-down strategies
1. What Spend-Down Means
The basics:
- SSI has a $2,000 resource limit
- Checked on the 1st of each month
- If you're over, you're not eligible that month
- Spend-down means using money before the 1st
Why timing matters:
- Only the 1st of the month matters for SSI
- You can have more during the month
- Just need to be under $2,000 on the 1st
- Plan purchases accordingly
When to spend down:
- After receiving back pay
- If savings are approaching the limit
- When you receive gifts or inheritance
- Before the end of any month you might be over
2. Purchases That Reduce Countable Resources
Pay bills:
- Rent or mortgage
- Utilities
- Phone/internet
- Insurance premiums
- Medical bills
Buy necessities:
- Groceries
- Clothing
- Personal care items
- Household supplies
Home-related purchases:
- Furniture
- Appliances
- Home repairs
- Accessibility modifications
Transportation:
- Car repairs
- Gas
- Bus passes
- Rideshare credit
Medical and health:
- Medications
- Medical equipment
- Therapy copays
- Dental or vision care
Personal property:
- Computer or phone
- Household goods
- Tools
- Books
Important: Keep receipts for all significant purchases in case SSA asks about your spending.
3. What Doesn't Count as Spending Down
Giving money away:
- Gifts to others don't count as legitimate spend-down
- Can be seen as hiding resources
- May affect eligibility
- SSA tracks transfers
Purchasing countable resources:
- Buying stocks or investments
- Opening CDs
- Purchasing real estate (other than your home)
- These are just changing one resource to another
Paying someone else's bills:
- Unless you legally owe the debt
- Paying a friend's rent isn't spend-down
- Must be your own expenses
Pre-paying too far ahead:
- Some expenses can be prepaid
- But don't go overboard
- Paying 2 years of rent in advance looks suspicious
- Be reasonable
4. Smart Spend-Down Strategies
Prioritize by timing:
- Pay bills that are due soon
- Buy things you'll need anyway
- Don't wait until the last minute
ABLE account contributions:
- Contribute up to $18,000/year
- First $100,000 doesn't count for SSI
- Money stays accessible for qualified expenses
- Best long-term solution
Stock up on necessities:
- Non-perishable groceries
- Toiletries and household supplies
- Over-the-counter medications
- Things you'll use eventually
Pay ahead (reasonably):
- Next month's rent
- Upcoming insurance premiums
- Medical appointment copays
- Keep it sensible
Make needed purchases:
- Replace worn-out items
- Buy that thing you've been putting off
- Home or car repairs you've delayed
- Clothing you need
What not to do:
- Don't buy things you don't need
- Don't waste money
- Don't give money to others
- Don't buy luxury items
- Don't be reckless
Documentation Tips
Keep receipts:
- For all significant purchases
- Organized by date
- In case SSA asks questions
- Digital photos work too
Track your balance:
- Know where you stand all month
- Plan spend-down before the 1st
- Don't cut it too close
- Leave a small buffer
Record what you bought:
- List items and amounts
- When you made purchases
- Why you needed them
- Shows intentional planning
How Purple Helps
Purple makes spend-down easier:
- Real-time balance tracking
- Alerts before the 1st
- Clear transaction history
- ABLE account integration
- See exactly where you stand