Spending your disability benefits correctly protects your eligibility. Here's what you need to know about what you can buy without jeopardizing your SSI or SSDI.
In this article, we'll cover:
- SSI vs SSDI spending rules
- What spending is safe
- What to watch out for
- Smart spending strategies
1. SSI vs SSDI Spending Rules
SSDI spending:
- No restrictions on how you spend
- No resource limits
- Your money to use
- Complete flexibility
SSI spending:
- Must stay under $2,000 resource limit
- Spending down is common
- What you buy matters
- More restrictions
The key difference:
- SSDI: Spend however you want
- SSI: Spend to stay under limits
- Different programs, different rules
- Know which you're on
Concurrent benefits:
- If you have both, SSI rules apply
- Must manage resources
- SSDI portion unrestricted
- SSI portion has limits
Important: If you're on SSI, it's not about what you spend money ON—it's about what you have LEFT at the first of the month.
2. What Spending Is Safe
Always safe (excluded resources):
- Housing costs (rent, mortgage)
- Utilities
- Food and groceries
- Medical expenses
- Clothing and personal items
Converting to excluded assets:
- Home improvements
- Vehicle (one car excluded)
- Household items
- Burial funds (up to $1,500)
ABLE account contributions:
- Move money to ABLE
- Save without limits
- Protected savings
- Smart strategy
Paying bills:
- Prepay rent
- Pay ahead on utilities
- Clear medical bills
- Reduce debts
3. What to Watch Out For
Things that build resources:
- Large bank deposits
- Selling excluded items for cash
- Receiving gifts or inheritance
- Settlement money
Timing matters:
- First of month balance checked
- Spend before month ends
- Don't let cash accumulate
- Plan large purchases
Gifts to others:
- May raise questions
- Could affect eligibility
- Document purpose
- Be careful with amounts
Investment concerns:
- Stocks, bonds count
- Retirement accounts may count
- Complicated rules
- Check before investing
4. Smart Spending Strategies
End-of-month spending:
- Pay bills before month ends
- Stock up on groceries
- Make needed purchases
- Reduce cash balance
Strategic purchases:
- Buy things you need
- Don't waste money
- Plan ahead
- Convert to excluded assets
ABLE account strategy:
- Transfer excess to ABLE
- Build emergency fund
- Grow savings safely
- Use for qualified expenses
Record keeping:
- Track all spending
- Save receipts
- Document large purchases
- Explain if SSA asks
Common Questions
Can I buy gifts for others?
- Yes, but carefully
- Small gifts usually fine
- Large amounts raise flags
- Document the occasion
Can I help family with money?
- SSI is for your needs
- Helping others may be questioned
- Keep amounts reasonable
- Your needs come first
Can I take a vacation?
- Yes, benefits allow it
- Travel rules apply (especially SSI)
- Budget appropriately
- Spending on travel is fine
Can I save for emergencies?
- Use ABLE account
- Keep bank account under $2,000
- Burial fund exclusion helps
- Plan ahead
How Purple Helps
- Track your balance
- Monitor spending
- Stay under limits
- See where money goes
- Plan purchases