Maximize SSI and Social Security benefits for disabled adult children

Key takeaways

• Families with disabled adult children often do not take full advantage of their SSI and Social Security benefits due to a lack of awareness or misunderstanding of the eligibility rules.
• You can help clients with disabled children navigate the process to collect SSI and maximize their family’s Social Security benefits over time.
• Giving clients peace of mind about the future for their disabled child is a valuable service that can deepen loyalty and earn referrals.

Don’t let clients miss out on federal SSI benefits

Do any of your clients have disabled children? If you aren’t sure, ask them. The expense of caring for a disabled child can be significant and many families do not take full advantage of the federal benefits available to them due to a lack of awareness or misunderstanding of the eligibility rules. To illustrate how you can help clients in this situation, consider the story of the Thompson family.

Julia Thompson was born with a disability that will require special care throughout her life. When she was a toddler, her parents, Philip and Monica Thompson, applied on her behalf to receive federal Supplemental Security Income (SSI), a monthly benefit program administered by the Social Security Administration (SSA). Like many families, the Thompsons’ household income exceeded the limit for eligibility. The couple resigned themselves to bearing the cost for Julia’s care on their own. 

Fast forward 20 years. The Thompsons hire a financial advisor, Caroline. Upon learning of their daughter’s disability, Caroline imparts some valuable information to Philip and Monica: 

“Federal SSI is a needs-based program and children under age 18 are subject to ‘deeming,’ which means that a portion of the parents’ income is deemed to be available to the child. Although the SSA adjusts the income limit for eligibility annually, it is historically set at a level that is low enough to disqualify most disabled minors. 

“What many people don’t know is that once their child turns 18, deeming no longer applies. As an adult, a disabled child is eligible for federal SSI benefits as long as their own income and assets remain within the program limits. Additionally, some states supplement the federal SSI benefit based on income, living arrangements and other factors.”

Caroline helped the Thompsons reapply for benefits on behalf of Julia, who is now 22 years old. Julia qualified for the maximum monthly federal SSI disability benefit, which is $967 in 2025 and adjusts annually to account for increases in the cost of living. Having missed four years’ worth of benefits, Philip and Monica only wish they had hired Caroline to be their advisor much sooner.

Show clients how federal benefits for their disabled adult child can increase over time 

At their next meeting with Caroline, Philip and Monica unloaded their worries about their daughter’s future. It was unlikely that she would ever marry or have a job and her SSI benefit does not cover all of the expenses for her care. Philip and Monica are concerned about the impact those expenses will have on their budget after they retire as well as their ability to build adequate savings to meet Julia’s needs after they pass away. Monica wants to retire early but she believes it is not realistic given Julia’s financial needs. 

“The uncertainty about Julia’s future must be stressful for you both,” Caroline began. “Having a plan can help alleviate some of that stress.” Caroline went on to explain how three life events may cause Julia’s benefits to increase in the future:

1. When a parent files for retirement benefits

Upon filing for retirement benefits, parents of children who receive SSI are required to also file an application for the Childhood Disability Benefit. This benefit is provided by the SSA to adult children (including adopted children, and in some cases stepchildren, grandchildren or step grandchildren) who are unmarried and have a qualified disability that began before age 22. The monthly benefit amount is equal to 50% of the parent’s full-age retirement benefit, known as the Primary Insurance Amount, or “PIA.” 

If the amount of an individual’s Childhood Disability Benefit is larger than their SSI benefit, the SSI benefit will stop when the Childhood Disability Benefit starts. If the Childhood Disability Benefit amount is smaller than the SSI benefit, then the SSI benefit will be reduced by the amount of the Childhood Disability Benefit. Therefore, a child’s overall monthly benefit amount cannot decrease – but it can increase – when a parent files for the Childhood Disability Benefit.

Caroline showed the Thompsons how to obtain PIA estimates on the SSA web site and determined that when Monica files for retirement benefits, her projected PIA of $2,350 would provide Julia with a Childhood Disability Benefit of $1,175. That’s a step up from the $967 that Julia receives as an SSI benefit. 

The Childhood Disability Benefit is always 50% of the PIA regardless of when the parent files for retirement benefits.

• If Monica chooses to retire early, her own benefit would be reduced but Julia’s would not be impacted. For example, if Monica were to start collecting Social Security at age 62, her monthly benefit would be reduced from $2,350 to $1,645, but Julia would still receive $1,175.
• If Monica works past her full retirement age, her own monthly benefit may be higher than her PIA but Julia’s monthly benefit would not be affected. However, it’s important to consider that the Childhood Disability Benefit will not start until Monica begins collecting retirement benefits, so any delay in Monica’s filing also delays the ‘step up’ in Julia’s monthly benefit.

2. When a parent with a higher PIA files for benefits

Philip, who plans to work longer than Monica, has a projected PIA of $3,650. When he begins collecting retirement benefits, Julia can collect 50% of his PIA instead of Monica’s. This would provide another step up in her Childhood Disability Benefit from $1,175 to $1,825 per month.

3. When a parent passes away

If Philip passes away, Julia can collect a monthly survivor benefit that will continue for the remainder of her life as long as her disability status remains unchanged. This would increase her benefit from 50% to 75% of Philip’s PIA, bringing her monthly benefit to $2,737.

Disability benefits can change as a family evolves
Changes in Julia’s monthly benefit over her lifetime (hypothetical)

While not a concern for the Thompsons, there is a maximum family benefit that can be paid on a worker’s earnings record. Various factors may impact the amount of a Childhood Disability Benefit, such as the number of other disabled adult children receiving benefits and whether a spouse with a lower (or no) PIA collects spousal benefits on the same worker’s earnings. 

The Thompson example is a relatively simplistic illustration of the financial impact federal benefits can have for a family of a disabled child. Other scenarios can be much more complex depending on a family’s level of benefits, timeframe for claiming, employment history and life expectancies. But you don’t have to be an expert on Social Security or SSI. Just knowing the basics is enough to make a big difference in your clients’ outcomes. For more complex situations, consider partnering with an attorney who specializes in disability entitlements.

Helping clients maximize their benefits enhances your value

The Thompsons were relieved to see that managing Julia’s care expenses within their retirement budget wouldn’t be so difficult after all, even if Monica retires early. But they still needed to ensure their savings will be adequate to support Julia after they have both passed away.

Caroline showed the couple an analysis she produced using an online tool to compare collection strategies that projected their total retirement benefits in various scenarios using different filing dates and longevity assumptions. “This can help you consider your options as we discuss your plans for retirement and your savings goal for Julia,” she said. “Give it some thought and we’ll discuss it further at our next meeting.”

Philip and Monica walked out of Caroline’s office feeling more confident about their family’s future, and they began recommending Caroline to people they know.

Helping families with disabled children can make you stand out from other advisors. Consider getting involved with organizations who support people with disabilities and post about it on social media. Displaying items on your desk that represent these organizations may prompt clients to tell you about a family member’s disability that they hadn’t previously thought to mention.

Keep in mind that parents of disabled children have extra demands on their time and resources, which can make it challenging for them to prepare for their future. You can help them form a long-term plan for their disabled child by connecting them with local support groups or organizations that can offer insight about the different options for their child’s care.

As an advisor, you can offer a tremendous value to clients by helping them navigate the process for different types of federal benefits and incorporating Social Security collection strategies into their financial plan. BlackRock can help you maximize your clients’ benefits, which can boost loyalty and increase referrals. Use our online resources and learn more about the BlackRock Business Consulting team.