Money Management Tips When on SSDI
As anyone on Social Security Disability (SSDI) knows, it can be a challenge to make that money cover all living expenses. It’s not only important to make ends meet but try to make every dollar of your disability payment count. Luckily, there are a few money-management tips to help ease financial burdens. Developing these habits can make you feel more in control of your money. There are even some cases where family members may be eligible for auxiliary benefits. Try some of these money management tips below.
This is one skill that can make or break your ability to pay bills and make ends meet. Budgeting helps you understand exactly where your money is going. Setting up a monthly budget is like having a plan for your money. It will assist in anticipating expenses, show you the major expenses, and help plan for the future. According to Mint.com, there are 6 simple steps to setting up a monthly budget:
- Know how much money you have coming in. Aside from your SSDI, do you have other family members bring in income? Also, think beyond how much. Cash flow, when you receive money, is just as important to consider.
- Set your fixed budget categories. These are your expenses that don’t change from month to month. For example, mortgage or rent, car payments, cable bills, etc. Knowing your fixed expenses allows you to better plan for all the rest.
- Define your variable expenses. This will be all the categories you spend in that changes every month. It could include pet expenses, groceries, gas, etc. All these costs change, so tracking them and helping determine a rough average helps you anticipate future monthly budgets.
- Pay off debt first, then save money. Work to pay off credit card debt first, as this will end up costing you more in the long run. Once you have paid off debt, start putting as much money you can away in savings. This will help you prepare for unforeseen expenses in the future.
- Make adjustments to your budget. Now that you have everything done above, you can start seeing where you spend the most. Try to see where you can save money and see some suggestions below.
- Keep up the momentum. As you work toward your savings goals, continue to keep track every month so you can stay in control. Many times this can be stressful, but know your hard work will pay off, literally.
Where to Find Savings
Beyond budgeting, there are ways to help your dollar stretch. Take an honest look at your expenses and see where you spend the most. Here are some money saving tips to consider:
+ Trade-in a newer, high-monthly payment vehicle, for a used car. This could lower your payment or make it so you have none at all. Lowering or getting rid of car payments can also help you set that money toward debt or savings.
+ Clip those coupons. Groceries, especially for families, can be a money pit. Sometimes, especially with growing kids, it feels like they have hollow legs. However, keeping food on the table is essential. Coupons are a great way to keep those grocery expenses down. This can also help on other household items too.
+ Meal planning can really help you save in the long run. This doesn’t mean you have to cook everything at once, but rather you plan what you will eat for meals for the week. Having a menu helps you stick to it and less likely to eat out or order delivery last minute. Not only will it help plan groceries but it could lessen your eating out expenses.
+ Just ask if you can lower your bill. It isn’t always the case, but it never hurts to ask. Call your cable or phone company to see if they can lower your monthly bill. They may have programs you were unaware of or discounts you may be eligible for. You’ll never know until you ask.
Other Money Management Tips
Many times living off SSDI can lead to financial difficulties. This is nothing to be ashamed of and make sure you use your support system when you feel you need it. Outside their help, there are also other programs you can look into.
Consider low-income housing solutions if rent or mortgage is just too big of an expense. Always make sure to prioritize any medications or equipment you may need to stay healthy. You may even want to look into co-pay programs. If eligible, these services can help you pay for a portion of your medical expense and are completely free. We recommend you speak to your doctor or pharmacist to help you apply. Furthermore, there is the Achieving a Better Life Experience (ABLE) Act of 2014. This allows states to create tax-advantaged saving programs for eligible individuals.
Keep all of these and the money management tips in mind when you are living off of disability payments. These can make a big difference. Overall, working on improving your money management skills, is great to have and can set an example for your other family members. Budgeting and controlling your finances in the best way to maximize your SSDI and reduce your financial concerns.