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Apache is functioning normally

May 4, 2024 by Brett Tams

Money management — how to save, budget, and invest — is a vital life skill that isn’t part of most school curriculums. As a result, it often falls to parents to prepare kids for this aspect of adulthood. The trouble is, talking about things like spending, saving, and taxes with your kids may not come naturally, especially if you were raised in a “don’t talk about money” household.

So when — and how — do you start talking about money with your kids?

Generally, it’s never too early to begin teaching kids about the concept of money. You might start just by normalizing conversations about money, so kids feel comfortable asking questions. Other easy strategies include offering a piggy bank to young kids, to introduce the concept of saving, and providing an allowance to older children, which helps them learn to budget and manage their own money.

Read on to learn more about some of the best ways to teach kids about money and put them on the path towards financial health and independence.

Why It’s Important To Teach Kids About Money Management

Whether it’s the importance of saving or how to open a new bank account, money lessons help ensure that kids will make smart financial decisions in the future.

Children who are introduced to basic financial concepts at an early age are likely to feel more confident about their spending habits and have less financial anxiety when they’re older. Teaching young children simple lessons about money management also makes it easier to impart more complex financial lessons as they get older. This can help set them up for success when they get that first summer job, go off to college, and enter the working world.

Money Management Explained

First, let’s look at the big picture. Helping kids understand the basics of money management is important…but what is money management anyway? Some adults can’t answer that question, let alone explain it to their children.

Simply put, money management refers to how you handle all of your finances. It involves keeping track of what’s coming in and what’s going out (and making sure that latter doesn’t exceed the former), being smart about debt, and setting money aside for both short- and long-term goals.

While adults generally understand that saving money is important, it typically takes an engaging approach to get kids psyched about hoarding their pennies rather than spending them on a video game. With the right strategies, however, teaching kids about money management can wind up being a satisfying and fun experience for the whole family. It might even give you a renewed focus on your own money skills.

Money Management for Kids in 6 Steps

Here’s a look at some of the best ways to boost money management for kids.

1. Start Early

Children as young as three years old can start to grasp the basic concept of “We need dollars to get ice cream.” Talking about money in a positive, or simply neutral, way and being transparent about your own financial life (“I got paid today,” or “I need to pay bills tonight”) begins to ground kids in the ebb and flow of finances. It helps a child learn the value of money.

Parents can use a routine trip to the grocery store to point out price tags and how some things cost more than others. Asking a salesperson or cashier, “How much is this?” can clue children in to a transactional truth: You have to have money to buy something. Paying bills in front of them helps them understand that families also have household expenses.

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2. Provide an Allowance

Offering an allowance can be a great way to teach kids to manage money responsibly. The ground rules for a child’s allowance vary from family to family; some start a child off with an allowance at age five, and others at age 14. How much kids get also varies widely and is entirely up to you. One rule of thumb is to match the number of dollars per week with a child’s age, such as $10 a week for a ten year old. You might also ask around among other parents to get a sense of the “going rate.”

Here’s a look at the two common ways to structure allowance.

• Chore-based allowance: With this set-up, a child does chores in order to get paid. This system can instill a strong work ethic that will benefit children in the future. Some say a drawback of this method is that it could send a message that household chores are optional. But for many families, it works well.

• Fixed allowance: Here, you agree to pay your child a set amount of money every week or month no matter what. Separately, they are expected to do their chores and help around the house because they are part of the family. This arrangement allows a child to feel part of a greater whole — to be responsible for the tidiness of their room and offer to help with the dishes because that’s what family members do. Some may argue that paying children an allowance that isn’t chore-based could compromise their work ethic or promote a sense of entitlement, but it’s really up to each family to determine what works best for them.

3. Encourage Saving and Goal-Setting

Just as adults are motivated to save when they want to have enough money for, say, a vacation or new car, your child may be incentivized to save a target amount for a specific purpose. Or, you may have a child who just wants to see how high their savings can go — that’s fine too! You can encourage them to save just to find out how much they can stash.

You might also offer rewards for reaching savings milestones. For example, you could make a deal that if your child saves a certain amount, you’ll kick in a little bit more. This rewards them for exercising restraint, and it’s similar to a vesting or “company match” principle, which you could explain to an older child.

4. Give Them a Place to Stash Their Cash

For younger kids, keeping money close at hand can work well. Having their own piggy bank or child’s safe can also make saving more fun. For older kids, you might want to open a savings account in their name. Many banks offer savings accounts specifically geared toward children and teens. Typically, these are joint or custodial accounts that come with parental controls and tools that teach financial education.

5. Introduce Them to Credit

As teenagers become more independent and start driving themselves around, consider enrolling your child as an authorized user on one of your credit cards. This can not only be helpful in the event of an emergency, like a flat tire, it’s an opportunity to discuss how to be responsible with credit. You can explain how credit cards work differently than debit cards and how interest racks up quickly if you don’t pay off what you charge in full by the end of the billing cycle.

6. Explain Budgeting When They Graduate From College

Once your kids are earning money regularly and responsible for paying their own room and board, it’s a good idea to help them draw up a budget based on their salary and estimated expenses.

There are all kinds of budgeting methods, but they might start with the basic 50/30/20 approach. This involves putting 50% of their earnings toward needs, 30% toward wants, and 20% toward savings (including any money they are putting into a retirement plan offered by their employer). If their employer offers any matching contributions to their retirement contributions, encourage them to take full advantage, since this is essentially free money.

Fun Ways To Teach Kids Money Management

To make financial literacy fun and engaging, try one of these four money activities for kids.

Go Thrifting

Buying second-hand clothes can be a great way to teach kids how to be smart spenders. You might first go to a regular clothing store and look at the price tags on new clothing, then head to a local thrift store and compare prices. Consider giving your child a set amount they can spend on second-hand clothing. You can then enjoy watching them try to get as much as they can for their money.

Encourage Some Sibling Rivalry

If you’re teaching more than one child about money, consider setting up a competition to see which sibling can save more by a certain date. You might set a goal, such as saving a specific amount or towards a specific item, then offer a reward to the winner.

Set Up a Lemonade Stand

Letting kids set up and run a lemonade stand can help them learn valuable lessons about money, including earning income and entrepreneurship. It can also help them build confidence, resilience, and management skills. Plus, it’s fun. Just be aware that many states require kids to have a permit to operate a lemonade stand, so the first step is doing a bit of research.

Play Financial Board Games

Classic board games like Monopoly and Payday can also be great money activities for children. In Monopoly, for example, players buy and trade properties, develop them, and collect rent. There is even Monopoly Jr. for younger kids. Other fun money board games for your next family game night: the Game of Life, the Allowance Game, the Stock Exchange Game, and the Sub Shop Board Game.

Recommended: 52 Week Savings Challenge (2024 Edition)

The Takeaway

Teaching kids about money and how to manage it can prepare them to be financially responsible adults. By offering an allowance or payment for doing extra chores, kids can learn the value of money and rewards of saving and delayed gratification. Helping older kids learn how to budget and set up a bank account can instill a sense of confidence and independence, not to mention pride.

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FAQ

When should you start teaching kids money management?

Children as young as three years old can begin to understand the concept of paying for something and saving money in a piggy bank. Some parents start giving kids an allowance between the ages of five and seven, which can help them learn basic financial literacy concepts like saving, spending, and sharing. As kids get older, you can gradually introduce more complex concepts like budgeting, investing, and “good” vs. “bad” debt.

What are the benefits of teaching kids money management?

Teaching kids about money has numerous benefits. It instills financial responsibility, fosters good habits early on, and prepares them for real-world financial challenges. It also encourages critical thinking, goal-setting, and independence in making financial decisions.

How do you teach kids the value of money?

You can teach the value of money through hands-on experiences and age-appropriate activities. Encourage earning money through chores or tasks, involve them in family budgeting discussions, and demonstrate the consequences of spending choices. Emphasize the importance of saving for goals and how to differentiate between needs and wants.

How do you organize your kids’ money?

You can organize a kid’s money by helping them establish savings goals, allocate their money into different categories (such as saving, spending, and giving), and track their progress regularly. Consider using tools like jars, envelopes, or savings accounts to physically or digitally separate their money.

What is the 3 piggy bank system?

The “three piggy bank” system involves dividing money into three categories: saving, spending, and sharing. Each piggy bank represents a different purpose, teaching kids to allocate their money wisely. They learn the importance of saving for future goals, budgeting for everyday expenses, and contributing to charitable causes or sharing with others. This system helps instill foundational money management skills in a simple and practical way.

Photo credit: iStock/kate_sept2004

SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.

The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SOBK-Q224-1855684-V1

Source: sofi.com

Apache is functioning normally

May 3, 2024 by Brett Tams

Using a credit card to make purchases is straightforward, but understanding the ins and outs of how exactly they work can be more complicated.

On the back end, credit card issuers can take certain liberties that impact your cards’ features. If you dig into the fine print, you’ll find that card issuers generally mention they can make certain account decisions at their discretion. There are also unwritten liberties issuers can take, potentially in your favor. For instance, an issuer may be cooperative when you request lower interest rates, a higher credit limit or a switch to a different card entirely.

The more you understand your credit cards, the better you can navigate them.

Here are a few facts about credit cards that are good to know.

1. Some credit card terms can change with little if any warning

You may become accustomed to certain perks, rewards, fees or even interest rates over time, but those features can change — some more quickly than others. You’ll often find language supporting this in a card’s terms and conditions.

For significant changes — like increases to interest rates, fees and the minimum amount due — the card issuer generally must give notice 45 days in advance, according to the Consumer Financial Protection Bureau’s website. But benefits or rewards aren’t considered “significant,” so changes to those can come at any time. (Many issuers will still send an email or written notification as a courtesy to cardholders.)

Variable interest rates change at a quicker pace than other features, as has been the case since the Federal Reserve began hiking interest rates to battle inflation.

“Folks didn’t realize that the rise in the federal interest rate applies to their credit card also,” says Martin Lynch, director of education at Cambridge Credit Counseling, a nonprofit credit counseling agency. “Variable rate cards incorporate those hikes usually within a month or two, so you did see some people experiencing some sticker shock when the minimum payments went up.”

2. Issuers can close an account or cut your credit limit at any time

Even if you’re managing a credit card responsibly, an issuer can still legally close your account if it wants to, according to the CFPB website.

The issuer must provide an “adverse action notice” when it makes these kinds of unfavorable decisions, the website notes. But they can still catch you off guard.

3. Your creditor may be willing to bend on interest rates

For longtime customers with solid track records, an issuer might be willing to negotiate a lower interest rate. Alternately, a hardship plan (if available) can temporarily lower interest rates if the hardship is because of qualifying circumstances beyond your control.

If you’re having trouble juggling debt, credit card issuers may also be willing to work with you through a nonprofit credit counseling agency’s debt management plan, which can consolidate those debts into one fixed monthly payment if you qualify.

“Our average interest rate right now is about 8%, among all creditors,” Lynch says. “Some are higher, some are lower.”

For comparison, the average rate for credit cards that assessed interest in the last quarter of 2023 was 22.75%, according to Fed data.

4. You might not qualify for a sign-up bonus

Many credit cards offer an upfront pile of cash back, points or miles as an incentive for new cardholders who can meet a specific spending requirement. But if you’ve recently applied for a credit card with the same issuer — even if it’s been more than a year — you might not qualify for the advertised bonus.

As you’re applying for a credit card, it’s important to read the terms carefully to understand whether you’re eligible for such a welcome offer.

5. You can lose a 0% APR

If you have good or excellent credit (credit scores of 690 or higher), you might qualify for a credit card with a 0% introductory APR on purchases, balance transfers or both. But that promotional window may not be guaranteed.

If you pay late, for instance, the issuer could cancel the 0% APR offer and start charging the card’s ongoing variable interest rate instead. Depending on the card, a much higher penalty APR can also apply after missing a payment.

To avoid missing payments, set a reminder or establish an automatic payment schedule.

6. You might be able to upgrade or downgrade your credit card

If a credit card is no longer as valuable to you as it once was, contact the issuer to see whether it’s possible to upgrade or downgrade your credit card to a different option. This is also known as a “product change,” and it may allow you to retain your account number and account history while switching to a card that better suits your needs now.

You might consider downgrading to a different option to avoid an annual fee, for example. An upgrade might get you higher rewards or better perks.

7. The value of your rewards may vary

It’s not really an issue for cash-back credit cards, but if you have a co-branded store card or travel card, be aware that the points or miles that you’re earning may be less valuable for some redemptions than for others.

For example, your miles may be worth a penny or more each when redeemed for travel, but a good bit less than that when you redeem for options like cash back, statement credit or gift cards.

Knowing the true value of your rewards can help you maximize them. You can often get an idea of that value either by logging into your card account and exploring redemption options or by revisiting the card’s terms and conditions.

Source: nerdwallet.com

Apache is functioning normally

May 3, 2024 by Brett Tams

The following Five Surveys Review is a sponsored partnership with Five Surveys. Welcome to my Five Surveys Review! If you want to earn extra cash from home on your own schedule, I recommend trying out Five Surveys. This honest review of Five Surveys is going to explain what Five Surveys is, how Five Surveys works,…

The following Five Surveys Review is a sponsored partnership with Five Surveys.

Welcome to my Five Surveys Review!

If you want to earn extra cash from home on your own schedule, I recommend trying out Five Surveys.

This honest review of Five Surveys is going to explain what Five Surveys is, how Five Surveys works, and how you can earn spare cash with paid online surveys on Five Surveys.

If you’re interested in earning money online, you might have come across Five Surveys. This site pays users to complete surveys, giving an easy way to make extra cash from home. Unlike other survey sites that pay low amounts, Five Surveys has a simple deal: complete five surveys and earn $5.

I’ve been taking surveys for years, and I find it to be an easy way to earn extra money in my spare time.

I personally signed up for Five Surveys and have started taking surveys to test it out for you, my reader. One thing I really love about Five Surveys so far is the amount of surveys that are available. Already on the first day, there were 42 surveys that I could get started with, with more being added all the time.

Please click here to sign up for Five Surveys.

Five Surveys Review

Below is my Five Surveys review.

What Is Five Surveys?

Five Surveys, also known as 5 Surveys, is a website where you get paid to answer surveys online.

For every five surveys you finish, you can earn $5. Yes, once you answer your fifth survey, you can make quick cash, and they have a lot of available surveys for you to get started with.

If you’re all about making some extra cash, Five Surveys could be your go-to. Here are some reasons why I personally like Five Surveys:

This survey site is easy to use – Everything can be found right from the dashboard once you log in.
There are lots of surveys available – There are tons of surveys waiting for you, anytime. Whether it’s day or night, you can log in and find a survey to answer.
Fair payment for your time – For every 5 surveys you finish, you get $5. That means you’re earning $1 per survey, which is good for a few minutes of sharing your thoughts.
Get paid now, not later – Hate waiting? With Five Surveys, there’s no more watching the clock. After you complete 5 surveys, you can redeem your earnings.
Great customer service – They have a 24/7 live chat support team for any questions that you have.

When I first signed up for Five Surveys, I immediately received 42 surveys that I could start with. They ranged anywhere from 1 minute to 29 minutes. And, the way that the Five Surveys online platform works is that you need to answer 5 surveys to get the $5.

The surveys that you will see once you sign up for Five Surveys.

How Five Surveys works

Five Surveys is a platform where you can earn money just by sharing your thoughts and input through surveys.

Here’s how to get started on Five Surveys:

Sign up – First, you need to create an account. It’s free! You can join Five Surveys for free here.
Verify email – After signing up, check your email to find a verification link. Click it to activate your account.
Take surveys – Once your account is all set, you can start taking surveys. These surveys are a way for you to share your opinion on different things.
Earn money – For every 5 surveys you take, you get paid $5. That’s like getting $1 for each survey you complete!
Cash out – When you’re ready, you can take this money and put it in your pocket. The cash out process is simple and quick.

You may occasionally come across screen-outs (this is when you start a qualification survey but are deemed not their intended target market), but the more surveys that you take then the easier it is for Five Surveys to match you with better surveys with your customer profile. For example, the qualifier may ask if you have children, but the survey’s target criteria may actually be looking for households with no children. So, you will see less inconvenience when it comes to these with the more surveys that you take.

Note: The answers for the pre-survey questions need to be accurate and detailed so the you have more relevant surveys available.

Why does Five Surveys pay you to answer surveys?

Ever wondered why companies pay for your thoughts on surveys? It’s because your opinions matter! Companies want to know what you think about their products and services because they want to create things that you’ll like and want to buy.

Market research firms act like detectives for companies, gathering clues about what people want. They create surveys for us to fill out, which helps them figure out what products should be like. As a thank-you for your help, these companies reward you with cash and other payment methods.

What kind of questions are asked in surveys?

When you visit online survey sites to earn extra cash, you might wonder what kinds of questions you’ll be asked.

The questions can vary from survey to survey, but they tend to focus on your opinions about products or services, your preferences, and sometimes personal details such as whether you have pets or children at home and geographical characteristics (where do you live?).

I have taken over 100 surveys in my lifetime, and I have never once come across a hard question. They are always super easy and quick to answer.

Here’s a sneak peek into some typical questions that you may see:

How frequently do you eat out?
Is cost a big deal for you when shopping for something?
What do you value in a product like ____?
How much do you use items such as ____?
How much money do you make each year?
What fills up your free time?
Do you do a lot of research before you buy something? Or, do you impulse shop?
How many trips do you make to the grocery store in a month?

Survey creators design these questions to be easy—they don’t require you to be an expert or a genius.

In some surveys, you might come across detailed questions about specific items, while others might be broader and aim to understand you better. This helps companies figure out why certain products or services might be a good fit for you.

Here are some of the payment options you will see on Five Surveys.

How to cash out with Five Surveys

Getting your earnings from Five Surveys is quick and easy.

You simply go to your Five Surveys account and choose your withdrawal method. You can choose between PayPal cash, bank transfer, Venmo, and gift cards.

They have gift cards to places such as Walmart, Olive Garden, Southwest Airlines, Chewy, Apple, and more. There are over 187 different rewards that you can choose from actually.

Frequently Asked Questions

Below are answers to common questions about getting paid to take surveys with Five Surveys.

Is Five Surveys legit?

Yes, Five Surveys is a legitimate survey site known for rewarding people who complete surveys. On TrustPilot, Five Surveys has over 1,600 reviews with a good rating of 4.2 out of 5 stars (that means that most people have a positive experience on this site!). Some of the positive Five Surveys reviews that I read on TrustPilot talked about how Five Surveys is the best survey site due to the number of easy surveys available that pay a decent amount.

Can you actually earn money by completing surveys?

You can earn money by completing surveys on Five Surveys. The platform pays out cash and other rewards for the feedback you provide in surveys. Remember, the amount you earn will depend on the number of surveys you complete.

Does Five Surveys really pay?

Five Surveys does pay its users. Upon reaching a minimum account balance, you can redeem your earnings through different methods like PayPal, bank transfer, or Venmo, and also in the form of gift cards.

Is Five Surveys worth my time?

Whether Five Surveys is worth your time depends on your goals. It is an easy way to earn small amounts of money, but like most survey sites, it won’t replace a full-time income. It’s a decent option for earning a little extra on the side.

Is Five Surveys free?

Signing up for Five Surveys is free.

Five Surveys Review – Summary

I hope you enjoyed my Five Surveys Review.

Understanding how Five Surveys works is easy. Once you complete five surveys, you’ve earned $5, which you can cash out using the payout options offered by the site (such as PayPal cash and free Amazon gift cards).

For me, I love how easy it is to get paid to answer online surveys. You can take surveys while watching TV, while waiting for some food to cook, while doing chores, and more. It is super flexible and you can do it right from your phone or computer.

Please click here to sign up for Five Surveys.

Do you like to take surveys to earn extra cash? What other questions do you have for my Five Surveys Review?

Recommended reading: Prime Opinion Review: How Much Does Prime Opinion Pay?

Source: makingsenseofcents.com

Apache is functioning normally

May 3, 2024 by Brett Tams

If someone is applying for disability benefits, they may be relieved to learn that, yes, you can have a savings account while on Social Security disability. While there are certain financial factors that can disqualify someone from Social Security eligibility, having a savings account is not one of those factors.

But of course, there are some subtleties to be aware of with any benefits matter, so it’s important to take a closer look. Among the points to learn are the difference between SSDI (Social Security Disability Insurance) and SSI (Supplemental Security Income), who is eligible for Social Security disability benefits, and what the guidelines are for having a savings account while receiving benefits.

What Is Social Security?

There’s a reason the Social Security program is so well known: It has been providing financial support to Americans for many decades. Social Security benefits are designed to help maintain the basic well-being and protection of the American people. These benefits have been around since the 1930’s in response to the economic crisis caused by the Great Depression.

Today, one in five Americans currently receive some form of Social Security benefits — one third of those are disabled, dependents, or survivors of deceased workers. More than 10 million Americans are either disabled workers or their dependents.

💡 Quick Tip: Help your money earn more money! Opening a bank account online often gets you higher-than-average rates.

Can I Get Social Security Disability Insurance or Supplemental Security Income with a Savings Account?

You may be thinking you can’t have that kind of asset if you want to qualify for Social Security Disability funds. However, it is indeed possible to receive Social Security Disability Insurance (SSDI) or supplemental security income if you have a checking or a savings account.

Even better, it doesn’t matter how much money is held in that account. There are other program requirements that must be met to qualify for SSDI, but how much money someone has or doesn’t have in the bank isn’t one of them.

Eligibility for SSDI

In order to be eligible for SSDI benefits, the individual must have worked in a job or jobs that were covered by Social Security and have a current medical condition that meets Social Security’s definition of disability. Generally, this program can benefit those who are unable to work for a year or more due to a disability.

It provides monthly benefits until the individual is able to work again on a regular basis. If someone reaches full retirement age while receiving SSDI benefits, those benefits will automatically convert to retirement benefits maintaining the same amount of financial support.

Eligibility for SSI

If you receive Supplemental Security Income (SSI), however, there is a limit on how much you can have in savings. SSI is a federal support program that receives funding from the type of taxes known as general tax revenue, not Social Security taxes.

This program provides financial support to help recipients cover basic needs such as clothing, shelter, and food. It provides aid to those who are aged (65 or older), blind, and disabled people who have little or no income (or limited resources). To qualify, participants must be a U.S. citizen or national, or qualify as one of certain categories of noncitizens.

What You Have to Tell SS about Your Assets if You Want Benefits

There are certain assets (in this case, they’re known as resources) that must be disclosed in order to qualify for benefits through the SSI program. Typically, to receive benefits, one can’t own more than $2,000 as an individual or $3,000 as a couple in what the SSA deems “countable resources.” However, there aren’t any such limits in place for the SSDI program.

The value of someone’s resources (aka their financial assets) can help determine if they are eligible for Social Security benefits. If a recipient has more resources than allowed by the limit at the beginning of the month (when resources are counted), they won’t receive benefits for that month. They can be eligible again the next month if they use up or sell enough resources to fall below the limit.

Eligible resources can include:

• Cash

• Bank accounts (checking account, regular savings account, growth savings account; whatever you have)

• Stocks, mutual funds, and U.S. savings bonds

• Land

• Life insurance

• Personal property

• Vehicles

• Anything that can be changed to cash (and can be used for food and shelter)

• Deemed resources

The term “deemed resources” refers to the resources of a spouse, parent, parent’s spouse, sponsor of a noncitizen, or sponsor’s spouse of the Social Security benefits applicant.

A certain amount of these deemed resources are subtracted from the overall limit. For example, if a child under 18 lives with only one parent, $2,000 worth of deemed resources won’t count towards the limit. If they live with two parents, that amount rises to $3,000.

Recommended: What are the Different Types of Savings Accounts?

How Much Can I Have in My Savings Account and Receive SSI or SSDI?

For the SSI program, the total resource limit (which includes what’s in a checking account) can not be more than $2,000 for an individual or $3,000 for a couple. Again, there are no asset limits when it comes to the SSDI program. If someone is applying for the SSDI program, they can surpass that $3,000 limit, and it won’t matter as it doesn’t apply to them.

SSA Exceptions and Programs

Not every asset someone owns will count towards the SSI resource limit (remember, there is no such limit for the SSDI program). For the SSI program, there are some exceptions regarding what counts as a resource. The following assets aren’t taken into consideration:

• The home the applicant lives in and the land they live on

• One vehicle—regardless of value—if the applicant or a member of their household use it for transportation

• Household goods and personal effects

• Life insurance policies (with a combined face value of $1,500 or less)

• Burial spaces for them or their immediate family

• Burial funds for them and their spouse (each valued at $1,500 or less)

• Property they or their spouse use in a trade or business or to do their job

• If blind or disabled, any money they set aside under a Plan to Achieve Self-Support

• Up to $100,000 of funds in an Achieving a Better Life Experience account established through a State ABLE program

The Takeaway

When applying for Social Security benefits, having a savings account may or may not impact your eligibility. It depends on which program you are applying for. It is possible to have a savings account while receiving SSDI benefits. It’s also possible to have a savings account while receiving SSI, but there are limits regarding how much the value of the applicant’s assets (including what’s in their savings accounts) can be worth to qualify for support.

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FAQ

How much money can I have in a savings account while on Social Security?

Personal assets aren’t taken into account, including savings, when applying for the SSDI program. For SSI, however, countable resources (including savings accounts) are capped at $2,000 for individuals and $3,000 for couples.

Does Social Security look at your bank account?

That depends. If someone is applying for Supplemental Social Security Income (SSI) benefits, their personal assets are taken into consideration when it comes to eligibility. With Social Security Disability Insurance (SSDI), applicant assets aren’t taken into consideration.

What happens if you have more than $2,000 in the bank on SSI?

If you have more than $2,000 in the bank and are on SSI as an individual (more than $3,000 if you are part of a couple), you will not receive benefits for that month. Your finances will be evaluated the following month to see if your assets have fallen and you therefore qualify.

Does Social Security check your bank account every month?

Money in the bank doesn’t affect Social Security disability benefits. However, there is a $2,000 to $3,000 limit (varies by household) for the SSI program.

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