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Writer's pictureAlexandra Baig, CFP®

Should Youth with Disabilities Apply for Social Security at Age 18?

I went back to re-watch the first five seasons of “Schitt’s Creek”, when I realized, somewhat belatedly, that Season 6 had been released. The story line follows Johnny Rose after the video-store magnet and his wife and two adult children, all actors, and all socialites, have lost their fortune, courtesy of a questionable investment advisor. The Roses’ one remaining asset is the tiny town of Schitt’s Creek. Much of the humor comes from the fact that the Roses, who built up fortune and fame, have no safety net for living in the real world. In one episode, mother Moira, attempts to teach son, David, how to make grandma’s “Anch”-iladas, but neither of them can figure out how to fold cheese into the sauce. Daughter Alexis comes to her first day of work as a secretary at the veterinary clinic dressed in a scrub top and short shorts because she thought wearing both pieces of the scrub set was “optional.” Most of us will never have, nor lose, the wealth of the fictional Roses, but we will face life's ups and downs and might want to take a practical approach to gaining a safety net.

Some youth with disabilities struggle with the question of whether to file for Social Security benefits at age 18. Like their age peers, even though they do not yet have much work experience, they have skills and interests and a desire to get a job and contribute. They look at how Social Security defines “Substantial Gainful Activity” or “SGA” as the capacity to work and earn more than $1,260/month (2020), and they think “Maybe I will need some support and maybe I will not be able to work at that level right out of the gate, but I really believe I will be able to exceed that threshold if I work up to it.” The are intimidated by the bureaucratic process of applying and maintaining eligibility for disability benefits. They know that without much of a work record, the most they will receive for their efforts is the maximum Supplemental Security Income (SSI) benefit of $783/month—hardly a windfall—and they know that any work they do will reduce that benefit even further. So, is it worth their time and effort to claim a benefit that is so modest and that they may only receive for a few years?

As a financial planner, who focuses on these youths and their families, I say, emphatically, YES. I am a firm believer in two things about government benefits. The first is that anyone, who has the capacity to work, absolutely should work to the utmost of her/his potential. The second is that people with disabilities of any kind absolutely face barriers to finding and keeping employment that people without disabilities do not face and so they absolutely should claim any benefits to which they are entitled as a safety net. I encourage all clients with disabilities to apply for Social Security adult disability benefits when they turn 18. If they are already receiving Social Security benefits as a child under 18, I encourage them to go through the adult recertification process. This is why:

  • It will never be easier to explain your limitations than when you, as the applicant, have no post-secondary degree (perhaps not even your high school diploma) yet and very little or no work experience. When the Social Security Administration evaluates your capacity to do SGA, they consider your work history and educational qualifications in addition to your physical, intellectual, or behavioral conditions.

  • As a high school student, you probably have a larger, more recently-updated collection of intellectual, psychological, behavioral, and vocational assessments than you will ever have in future. Individual Educational Plans, documentation for accommodations, notes from job coaches and progress reports from therapists that you see through the school district can all be used to support your case.

  • As a youth with little to no work history, you will only qualify for SSI initially. However, if you then work, even while receiving SSI, you can earn Social Security credits (sometimes called quarters of coverage). If you can earn six quarters of coverage before the age of 24, then you are fully insured for Social Security Disability Benefits (SSDI).

  • If you establish that your disability started before your age 22, then if you have not reached SGA-level income by the time your parents retire, you will be eligible for a benefit, based on their work records, called a “Childhood Disability Benefit” (CDB) or, alternatively a “Disabled Adult Child” (DAC) benefit. Depending on your parents’ work histories, this benefit may be larger than any that you could obtain on your own work record.

  • Once you have qualified for SSI, you will almost always qualify for Medicaid. Medicaid is a prerequisite for accessing almost all adult services, which are paid for through Medicaid waivers. Adult services include job coaching and other employment-related supports as well as supports to maximize community access and independence in daily living.

  • Once you have qualified for Medicaid by virtue of qualifying for SSI, you fall into a category, called “Special Groups of Former SSI Recipients”. Even if you subsequently cease to receive a cash SSI payment because either 1) you earn too much or 2) you receive a CDB/DAC benefit from one of your parent’s work records, you can still retain your Medicaid eligibility and your access to Medicaid wavier-funded services.

  • Once you have received SSDI for 24 months, you will qualify for Medicare, which can be an effective health insurance plan. If you also still qualify for Medicaid, Medicaid will pay your Social Security premiums, deductibles, and co-pays.

  • Once you have qualified for Social Security Disability benefits, you have access to the Ticket to Work, which is a suite of services that are free to you, paid for by Social Security and can help you with everything from skills assessments to resume review to job search and requesting accommodations from an employer.

  • If you have a disability, such as a behavioral health condition or an autoimmune disorder which increases and decreases in severity, your capacity to work may fluctuate. When your health is good, you may be able to work over the level considered as SGA, but when your health deteriorates, you may need to reduce or stop work. While not “easy”, it is certainly “easier” to regain benefits, once you have had them in the past for the same condition.

  • If your disability is progressive, you may not need benefits initially, but will come to need them later. Again, it is easier to claim disability for a condition that has qualified you in the past and which is generally known to worsen over time.

Yesterday, an old friend contacted me. I have known him, since he was in high school, and I hired him when he was still a special education student in high school to do some part-time administrative tasks for me. Now as someone well into his adulthood, he called to tell me he had just been promoted at his security job to site manager. He has been with the company only a year. The promotion also includes a raise, and he is making enough to fully support himself in Green Bay, Wisconsin and even build a rainy-day fund. He is doing well and would not qualify for Social Security benefits now, by any means. But in the years that I knew him, he was on and off SSI, SSDI and Medicaid as both his part-time retail jobs and his health fluctuated. When he needed them, the benefits were there, and he was happy to have them even as he is now happy not to need them. As with the Roses, life has not always worked in my friends favor and unlike the Schitt’s Creek owners, he did not start from a position of wealth. But he did have the common sense to apply early for the benefits that then provided him a safety net until he could get securely established.

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